How Much True In A "Based On A True" Story?

Today I wrote a story based on actual recent events in the life of my family and friends. Looking at it, I know it would make a good short story. It needs some editing and polishing, of course. But how much truth do I leave in?

The story takes place prior to a tragic event. There are no names mentioned, but there are enough details that those who know the people will recognize the characters. There's no secrets being given away, nothing lurid or demeaning. The person I'm writing about would love the story. But would she love it about her?

There are several changes I can make but, with this premise, anyone who knows even the basics of what happened will know where the idea came from. In reality, isn't that what a writer does? They take an idea from somewhere, mix fact with fiction, and produce a story.

Some of what I wrote is fictional; the majority is fact. There are a lot of facts I have that weren't widely known. They could be mistaken for fiction by those who don't know. I could replace some of the fact with fiction, to reduce the fact content. But I'm still left with the question of how much is too much?

In this case, my conscience tells me to talk to the family and ask their opinion. The truth is, theirs is the only one that really matters to me right now, prior to submission. If they prefer I not submit it at all, well, we'll have to talk about that.

Still, I'm sure this won't be the last time I'm faced with this question while writing a story.