lend a friend £90k, for property deposit
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?
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?
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Comments
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Oh, please, just read some of the stories on this board about lending money to family and friends, and just don't do it!I used to think that good grammar is important, but now I know that good wine is importanter.0
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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.0 -
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.
In debt and looking for help? Look here for the MSE Debt Help Guide.
Also, If you need any free and impartial debt advice, the National Debtline, Stepchange, and the CAB can help.0 -
Just don't do it. You are inviting trouble and heartache into your life.0
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No, no, no, no, no.Dwy galon, un dyhead,
Dwy dafod ond un iaith,
Dwy raff yn cydio’n ddolen,
Dau enaid ond un taith.0 -
According to past posts you still have Mortgage debt of your own so are in no position to be throwing 90K at anybody else.0
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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...0
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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.0 -
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.0
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