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    • TonyMMM
    • By TonyMMM 15th Sep 10, 9:22 AM
    • 2,123 Posts
    • 2,122 Thanks
    TonyMMM
    • #2
    • 15th Sep 10, 9:22 AM
    • #2
    • 15th Sep 10, 9:22 AM
    What income does she have to support the loan , what credit history does she have, and why secured ?
  • millwall36
    • #3
    • 15th Sep 10, 11:11 AM
    • #3
    • 15th Sep 10, 11:11 AM
    Hi,

    It would be secured against her house. not sure about income, will check
    • AMILLIONDOLLARS
    • By AMILLIONDOLLARS 15th Sep 10, 12:45 PM
    • 2,242 Posts
    • 2,545 Thanks
    AMILLIONDOLLARS
    • #4
    • 15th Sep 10, 12:45 PM
    • #4
    • 15th Sep 10, 12:45 PM
    why not take out an unsecured loan for the amount? Seems silly to put her house on the line for such a small amount. If your mother is struggling with money, it may be an idea for her the down-size and use the surplus cash to live on instead of borrowing. At 71, if she can't support a loan, no one is going to lend her the money, unless they really want her house!

    AMD
    MORTGAGE FREE 17/10/2013!!
    £6500 - PAID OFF Barclays @ 0% interest free 24mths
  • millwall36
    • #5
    • 15th Sep 10, 2:29 PM
    • #5
    • 15th Sep 10, 2:29 PM
    Thanks for your reply milliondollars but isn't an unsecured loan going to be horrendous interest?

    Also, her monthly income is a minimum of £500
    • AMILLIONDOLLARS
    • By AMILLIONDOLLARS 15th Sep 10, 2:38 PM
    • 2,242 Posts
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    AMILLIONDOLLARS
    • #6
    • 15th Sep 10, 2:38 PM
    • #6
    • 15th Sep 10, 2:38 PM
    Most not all secured loans are normally for any amount over 10K, on top of that the rates can be variable, meaning they can go either up or down at the lenders discretion, please the loan period can stretch to anything upto 25years!. Look around the website, put in searchs for Ocean Finance, Firstplus (no longer trading) and you'll see what sort of a heartache your mother could be in for. If your Mother could get a fixed rate (meaning the interest is set in stone) loan she would be far better off.

    If you don't mind my asking, why does she want the loan in the first place, it would give people help in giving you the right advice.

    AMD
    MORTGAGE FREE 17/10/2013!!
    £6500 - PAID OFF Barclays @ 0% interest free 24mths
  • millwall36
    • #7
    • 16th Sep 10, 10:05 AM
    • #7
    • 16th Sep 10, 10:05 AM
    She would be taking the loan out for her brother who has debt problems and bad credit but will be making the repayments direct to her until his credit rating goes back up
    • AMILLIONDOLLARS
    • By AMILLIONDOLLARS 16th Sep 10, 10:59 AM
    • 2,242 Posts
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    AMILLIONDOLLARS
    • #8
    • 16th Sep 10, 10:59 AM
    • #8
    • 16th Sep 10, 10:59 AM
    She would be taking the loan out for her brother who has debt problems and bad credit but will be making the repayments direct to her until his credit rating goes back up
    Originally posted by millwall36

    Not a good idea have you seen the thread about lending to family and friends:

    http://forums.moneysavingexpert.com/showthread.php?t=76953

    Here's a taster from Stockmarket -Diva - quoted from the above link:

    I'm sorry, I didn't read the beginning of this thread and hope its applicable to what i'm going to write now.

    I lent my sister and her husband a large amount of money at a very low monthly repayment because she purported to be in alot of problems financially...thought she was going to lose her house etc.

    No problems with them repaying it but immediately they got the money they booked numerous holidays, bought 2 cars, had garden landscaped, etc etc. I was mortified but at the same time it was my Sister and I don't think I wanted to disbelieve her.

    After a couple of years the spending was getting ridiculous and I thought that if they were okay now she could get a normal loan and pay all my money back. This was partly a safety measure becuase I was worried that if she was getting into more debt and ended up bankrupt, then I would never get the money back and my daughters would need it eventually.

    Well, guess what my family are like. My Father advised her to tell me that I'd have to take her to Court to get the money back . Thats family loyalty for you.

    I not only have lost a sister but my parents too. How can I ever believe that they have my best interests at heart.


    Because he has proved that he is no good with money, what will happen to your mother when he doesn't pay her back after a couple of months? will you be able to make the payments on her behalf then?

    If she is going to lend him this money, then I would suggest that she employs a solicitor to draw up a contract setting out the terms of this loan. So should he defaults, she can take him to court. Best advice I would give is, get it in writing, better still if she can't afford to lose this money, then don' loan it at all, especially as she could lose her house in process.

    AMD
    Last edited by AMILLIONDOLLARS; 16-09-2010 at 11:07 AM.
    MORTGAGE FREE 17/10/2013!!
    £6500 - PAID OFF Barclays @ 0% interest free 24mths
  • millwall36
    • #9
    • 16th Sep 10, 11:04 AM
    • #9
    • 16th Sep 10, 11:04 AM
    Thanks for that AMD, was going to get some paparwork drawn up for her with a solicitor.

    Still have no idea what lender to go to though, can you help?
    • AMILLIONDOLLARS
    • By AMILLIONDOLLARS 16th Sep 10, 12:59 PM
    • 2,242 Posts
    • 2,545 Thanks
    AMILLIONDOLLARS
    No one is going to give your 71 year old mother a secured loan for £5k on an approx income of £500 per month. That's classified as irresponsible lending. Get your uncle to join this board and sign in with the Debt Free Wanna Be Forum!!

    AMD
    Last edited by AMILLIONDOLLARS; 16-09-2010 at 1:02 PM.
    MORTGAGE FREE 17/10/2013!!
    £6500 - PAID OFF Barclays @ 0% interest free 24mths
    • euronorris
    • By euronorris 16th Sep 10, 1:10 PM
    • 9,559 Posts
    • 44,991 Thanks
    euronorris
    What does the brother need the loan for?

    Edit: Why can't he save? And, if it's to consolidate his debts, then it suggests that he would most likely still struggle to keep up the payments. In which case, an income and expenditure overhaul would be best, or get him to talk to one of the debt charities like CCCS.
    • woodbine
    • By woodbine 16th Sep 10, 5:15 PM
    • 18,345 Posts
    • 24,709 Thanks
    woodbine
    She would be taking the loan out for her brother who has debt problems and bad credit but will be making the repayments direct to her until his credit rating goes back up
    Originally posted by millwall36
    then advise her that she shouldnt do it under any circumstances
    the fact that he has a bad credit rating makes it unlikely that he will repay a relative for doing this for him,there are dozens of examples on this forum alone.
    • CLAPTON
    • By CLAPTON 16th Sep 10, 5:18 PM
    • 37,748 Posts
    • 26,518 Thanks
    CLAPTON
    Thanks for that AMD, was going to get some paparwork drawn up for her with a solicitor.

    Still have no idea what lender to go to though, can you help?
    Originally posted by millwall36

    what good is a legal agreement if he doesn't have the money to repay her?
    • barbiedoll
    • By barbiedoll 16th Sep 10, 5:29 PM
    • 4,316 Posts
    • 11,577 Thanks
    barbiedoll
    If he can afford to pay her, he can afford to pay his own debts! Do not let her get a loan to pay his debts, she will be lumbered with the repayments, if he has debt problems and bad credit then that's his problem. He can get plenty of help and advice for his situation, do your mum a favour and tell her that she won't get a loan at her age anyway.
    "I may be many things but not being indiscreet isn't one of them"
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