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  • FIRST POST
    • snickpan
    • By snickpan 14th Sep 17, 11:29 AM
    • 53Posts
    • 8Thanks
    snickpan
    lend a friend £90k, for property deposit
    • #1
    • 14th Sep 17, 11:29 AM
    lend a friend £90k, for property deposit 14th Sep 17 at 11:29 AM
    He's good for the repayments, this £90k will avoid him having a second charge against one of his properties, which would be at a whopping 8.4%, plus £1500 commission, plus £6000 arrangement fee.
    This will ensure the property purchase goes through smoothly, he'll put that property on the market in order to pay me back, and he says he'll give me a couple of grand on top for my trouble, and I believe him. Trust is not an issue here, it's just how to do it properly.
    Unfortunately he told the solicitor that he's being leant the money, and solicitor is saying that the lenders might not accept that!
    Is it too late to just pop the money in his account, and he'll then say, "oh it's ok, I've just transferred this from my other account"?
    If he had this years accounts, he could find other products, but time is an issue, can't lose a few weeks for accountant to pull his socks up, and then wait for the sa302 to come back...
    For our peace of mind, what can a solicitor do to make the loan legally binding? What kind of price? Or could we knock up a bit of a4 and have it witnessed?
    Last edited by snickpan; 14-09-2017 at 11:34 AM.
Page 1
    • iolanthe07
    • By iolanthe07 14th Sep 17, 11:34 AM
    • 4,903 Posts
    • 4,620 Thanks
    iolanthe07
    • #2
    • 14th Sep 17, 11:34 AM
    • #2
    • 14th Sep 17, 11:34 AM
    Oh, please, just read some of the stories on this board about lending money to family and friends, and just don't do it!
    Last edited by iolanthe07; 14-09-2017 at 11:34 AM. Reason: typo
    I used to think that good grammar is important, but now I know that good wine is importanter.
    • Kidder81
    • By Kidder81 14th Sep 17, 11:42 AM
    • 60 Posts
    • 59 Thanks
    Kidder81
    • #3
    • 14th Sep 17, 11:42 AM
    • #3
    • 14th Sep 17, 11:42 AM
    I'm always amazed by posts like this.

    When a lender won't lend money to someone who has got their deposit in the form of a loan, it's for a very good reason.

    If you're prepared to lose 90k and a friendship, go ahead.
    • StopIt
    • By StopIt 14th Sep 17, 11:52 AM
    • 1,371 Posts
    • 1,167 Thanks
    StopIt
    • #4
    • 14th Sep 17, 11:52 AM
    • #4
    • 14th Sep 17, 11:52 AM
    There's a lot of conditions here that frankly, are out of your friends control.


    What if the property doesn't sell for x period of time? How long are you prepared to wait for your money back?


    Sounds like someone trying to offload a load of risk to the first mug with a big bank balance.
    • Suplex Backbreaker
    • By Suplex Backbreaker 14th Sep 17, 11:53 AM
    • 101 Posts
    • 77 Thanks
    Suplex Backbreaker
    • #5
    • 14th Sep 17, 11:53 AM
    • #5
    • 14th Sep 17, 11:53 AM
    Just don't do it. You are inviting trouble and heartache into your life.
    • Oakdene
    • By Oakdene 14th Sep 17, 11:54 AM
    • 1,343 Posts
    • 3,830 Thanks
    Oakdene
    • #6
    • 14th Sep 17, 11:54 AM
    • #6
    • 14th Sep 17, 11:54 AM
    No, no, no, no, no.
    Hiraeth
    • Raven42
    • By Raven42 14th Sep 17, 11:54 AM
    • 16 Posts
    • 28 Thanks
    Raven42
    • #7
    • 14th Sep 17, 11:54 AM
    • #7
    • 14th Sep 17, 11:54 AM
    According to past posts you still have Mortgage debt of your own so are in no position to be throwing 90K at anybody else.
    • amfan
    • By amfan 14th Sep 17, 11:56 AM
    • 94 Posts
    • 69 Thanks
    amfan
    • #8
    • 14th Sep 17, 11:56 AM
    • #8
    • 14th Sep 17, 11:56 AM
    Aside from all the reasons why lending any amount of money let alone money on that scale is a terrible idea, yes it is too late for him to say "oh no my mistake, I didn't borrow it I had it sitting in my other account". Solicitors and mortgage lenders really aren't silly, they will simply ask him to prove it by showing the details of the other account back to the source of when the £90k came to be, and proof of the transfer to his current account. You could gift him the money as lenders accept gifts as sources of deposits, but then of course he'd have to prove a solid reason why you'd gift a friend £90k. And of course when he chooses not to pay it back you have no leg to stand on as you gifted it to him...
    • MEM62
    • By MEM62 14th Sep 17, 4:00 PM
    • 1,373 Posts
    • 987 Thanks
    MEM62
    • #9
    • 14th Sep 17, 4:00 PM
    • #9
    • 14th Sep 17, 4:00 PM
    Trust is not an issue here
    Originally posted by snickpan
    It will be!
    • ndf9876
    • By ndf9876 14th Sep 17, 4:13 PM
    • 102 Posts
    • 43 Thanks
    ndf9876
    When my other half and I bought our house, her parents gifted us a few thousand to get us "over the line" as it were, so we didn't lose the house. They had to sign a letter stating that the money was a gift, and they had no interest in the property, as well as proving where the money had come from (sale of Premium Bonds as it goes).

    There are (I believe) criteria from different lenders on gifts and who they will accept them from; even if you DID convince a lender it was a gift, if your friend decided one day he just didn't fancy repaying you, you'd probably be left without a leg to stand on.

    My personal advice would be for you to steer well clear of this deal - if your friend cannot afford to buy another property then perhaps he / she shouldn't bother.
    • Jackmydad
    • By Jackmydad 14th Sep 17, 4:52 PM
    • 1,072 Posts
    • 2,111 Thanks
    Jackmydad
    Unless you really are a multimillionaire and can literally afford to lose the money, then forget about it.
    I won't lend anyone money at all.
    There are too many tales of "trustworthy real friends" letting people down on much smaller amounts.
    If as said you have a mortgage yourself, do yourself a favour and use it to pay that off.
    • dresdendave
    • By dresdendave 14th Sep 17, 5:36 PM
    • 657 Posts
    • 766 Thanks
    dresdendave
    Trust is not an issue here
    Originally posted by snickpan

    For our peace of mind, what can a solicitor do to make the loan legally binding? What kind of price? Or could we knock up a bit of a4 and have it witnessed?
    Originally posted by snickpan

    The fact you feel the need for a signed agreement suggests that trust is an issue after all.


    Another vote for DON'T DO IT
    • waamo
    • By waamo 14th Sep 17, 5:36 PM
    • 2,089 Posts
    • 2,495 Thanks
    waamo
    Giving 90k to someone. Why not, what could possibly go wrong.
    This space for hire.
    • Gambler101
    • By Gambler101 14th Sep 17, 6:15 PM
    • 528 Posts
    • 1,292 Thanks
    Gambler101
    Like others have said, literally gift him the £90K, because then you wont be upset if he stiffs you, which I would put at 50%.
    The instructions on the box said 'Requires Windows 7 or better'. So I installed LINUX
    • maisie cat
    • By maisie cat 14th Sep 17, 6:30 PM
    • 264 Posts
    • 297 Thanks
    maisie cat
    no
    I loaned my brother a much smaller amount to buy a house in 1998.
    I even borrowed it for him because I'd just bought my own house.
    I am still waiting for it back
    • badmemory
    • By badmemory 14th Sep 17, 6:45 PM
    • 939 Posts
    • 970 Thanks
    badmemory
    Ever heard "neither a borrower nor a lender be". There is a good reason for it. If you don't lend the money you may lose a friend, if you do lend the money you will lose a friend & a lot of money! Well odds are you will anyway.
    • bobbymotors
    • By bobbymotors 14th Sep 17, 6:54 PM
    • 524 Posts
    • 727 Thanks
    bobbymotors
    Ever heard "neither a borrower nor a lender be". There is a good reason for it. If you don't lend the money you may lose a friend, if you do lend the money you will lose a friend & a lot of money! Well odds are you will anyway.
    Originally posted by badmemory

    My brother always said 'never a borrower or lender be...'

    He recently lost his job at the library.
    • Tarambor
    • By Tarambor 14th Sep 17, 6:55 PM
    • 1,530 Posts
    • 1,054 Thanks
    Tarambor
    Lend him £90k and you'll get a couple of grand as thanks? So you're going to lose money on this deal given that you should be able to get at least double that in a year investing it? That is assuming he pays it back. You say he can afford it but that is now and basically you getting your money back not only depends on him selling the property but selling it at a profit. Have you seen what is happening to property prices at the moment?
    • boliston
    • By boliston 14th Sep 17, 7:28 PM
    • 2,408 Posts
    • 1,985 Thanks
    boliston
    If I lent money to a friend in need i would always consider it as a gift - i would not expect repayment if i valued the friendship.
    • annandale
    • By annandale 14th Sep 17, 7:49 PM
    • 926 Posts
    • 1,980 Thanks
    annandale
    You would lend someone 90 grand and not expect repayment? Sure you would.
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