One consistent issue beginning writers have with modeling characters on people close to them is their fear that their models will recognize themselves in the finished script and not be happy. Because of this fear, they often tend to stay clear of any idea drawn from their own lives which would automatically involve characters based on real people.  They don’t want to offend or upset anyone.  They’re unwilling to risk the possibility that a friend or family member might see an unflattering portrayal of a character obviously based on them.
     My experience tells me that such fears are largely unwarranted.  First, what you have to keep in mind is that at the early stage of considering possible ideas most situations and characters will be drawn from your life.  You have to accept this as the starting point.  You don’t have any real choice here; if you want to write good scripts, you have to draw, one way or another, on your own life experience and the people you’re close to. 
     Second, and equally important to keep in mind, is that situations and characters initially drawn from your own life will undoubtedly go through major adjustment and change as the writing process unfolds.  Without fail, what you think at first is going to be a perfect reconstruction of the real person will, by the time you’ve completed a draft, be far removed from its model.  You have no way of knowing how this is going to happen up front, of course, but nine times out of ten, this is the end result.
     The writing process has a way of turning characters based on real people into their own people.  They take on their own voices and behave in surprising ways.  They start telling you what they’re going to say and do.  Before long you’re “forced” to leave the models they’re based on and allow whole new personalities to emerge.  All this is rather mysterious, but it happens every time.  It’s one of the most wonderful things about this crazy writing business–you end up creating “real” people who didn’t exist before.  Anyone who has written a number of scripts will identify with this.
     Another interesting point:  people who are the initial models for characters rarely recognize themselves in the finished script.  If anything, if you tell them, they’re flattered you found them interesting enough to base a character on them.  And if they do see a part of themselves in the character, they only see the good side.  They don’t identify with the negative traits, because people don’t admit to themselves that they have them.  If they do acknowledge these negative traits, usually they don’t have a clue as to how such traits manifest themselves in their behavior.  If they did, they’d stop acting that way!  As a result, when they see the character based on them do something unpleasant or nasty, they have no way of seeing or making a connection to themselves.  Their usual conclusion is that this is where you, the writer, have used your imagination.  In nearly all cases, models for characters simply don’t see themselves if portrayed in a less than flattering perspective.  You see it and recognize it as theirs, but they won’t.