How should I draw up a loan contract?

Big_roger

I have a friend that needs £10,000 to prevent him from losing his house. I am prepared to lend him the money because he has collateral and can pay me back over the next 3 months. We both agree that a formal loan contract is best. What form of words should it take to be binding?

welf_man

Whatever form a professional solicitor draws up! (Having checked the details of the threatened repossession, the collateral and the source of the repayments, that is). This is not something that should be a DIY job.

Having been a housing adviser for a number of years, I find it odd that a mortgagor would not accept payments of over £3000 per month, if they are verifiable. If your friend has collateral to back this loan, why has he not liquidated it before?

I'm not suggesting there is necessarily anything suspicious about this, but £10000 is a lot of money, however close friends you are.

Mel.