Were there others with empathy or love who were offering a better deal than an interest-free loan for the equivalent of ~$250 in today's money?
What in the letter indicates that the offer is interest free?
But, whichever way one looks at it, Rand is incoherent. She is giving an interest-free loan with no consequences for non-payment except estrangement, to a relative, despite her protest that family relatives occupy no special place in the hierarchy of people whom you are obligated to support. So unless she did or would offer the same deal to anybody who came along, she is giving her relatives special treatment. Rand just drew the line a little bit differently to others (e.g. some people would simply gift their relatives the money).