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MONEY MORAL DILEMMA. Should Tina lend to close mate Stina?

in MoneySaving polls
62 replies 66K views
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Replies

  • tabbycat2ktabbycat2k Forumite
    53 Posts
    Part of the Furniture 10 Posts Combo Breaker
    Forumite
    Yes, she can lend to her but they need a written agreement (covering interest and when the capital amount should be repaid etc) and Tina should declare the interest to taxman so she can pay her tax on it!
  • MyamothMyamoth Forumite
    62 Posts
    No, never ever lend money to a friend - you'll definitely lose the friend as they won't want to talk to you (in case you ask for a repayment, or they mention some spending they think you'll make them feel guilty about) and if the freind is that badly in debt with that bad a credit rating you'll probably lose your money too.

    Help her go through her budget and work out where she can save money to make the increased payments. Chances are if her credit rating is bad she isn't good with money so there will be lots of places costs could be cut.
  • I am very surprised and disappointed with the vast number of negative replies on this forum. I don’t know whether they represent British culture at large or just attitudes of people reading this web site, but I can not believe the lack of trust that people on this forum have in their friends.

    I come from former Yugoslavia and have arrived on my own to the UK as an asylum seeker during the Balkan wars ten years ago. In London I met several people who were in similar situation like me and became a good friend with them.

    At the time, none of us had a bank account, we were not credible and could not benefit in any way from the formal banking services.

    Within a year after my arrival, against all odds, I landed a well paid job with a reputable employer and as a consequence my credit rating soared.

    Over the next few years, I was frequently helping out many of my friends, sometimes with large amounts which I didn’t even have and which I borrowed from banks in order to lend to my friends who couldn’t get loans themselves. On one occasion I even paid several thousands of pounds for one friend’s Master’s studies – needless to say, I got ALL my money back! No a penny short!

    Today we are all homeowners with good careers and high credit rating. We don’t need to help each other out, but had my luck changed, I know I wouldn’t have to ask twice to borrow money from any one of my friends.
  • I've lent money to friends before and been paid back no problems but I also lent money to a friend once who didn't pay me back and as a result, the friendship is no longer. I think you really need to look at how much you trust the person and make your own judgement. If you can afford to lose what you lend, then I can't see the problem and if you do lose it and the friend as well, it's small payment to learn the truth about someone and get them out of your life for good. If you can't afford to lose it, I would be more hesitant. There is definitely a very limited amount of people in my life whom I would trust with money I couldn't afford to lose.
  • BargainSpotterBargainSpotter Forumite
    62 Posts
    Part of the Furniture 10 Posts Combo Breaker
    Forumite
    No. Although it would be tempting, the odd adage 'Never a borrower or a lender be' still rings true. Family & friends can easily fall out over money issues & in a worse case scenario, you wouldn't have any legal recourse to get your money back.
  • No, not a good idea.

    Many moons ago, I lent £45 to a "friend". I was a carefully budgetting, working, single parent, she had a husband and a part time job. She said it was urgent, and I could "hold" her child benefit book until the money reached that amount. (as I said, long time ago) (I am ancient)

    Of course, I had to give the book back for her to draw out the money. And she did give me it back, but £5 here £5 there. Although I did get the money back eventually, it never felt like the £45 I lent her. Should have gone to the Post Office with her when she drew her benefit. There we go.

    So it is not a good idea. Unless you can really be sure of the trust.
  • My wise old grandmother used to say never a borrower or lender be!
    What if she doesnt pay u back you have no course of legal action as u have no contract. Your friend needs to learn not to spend what she cant afford to pay back u bailing her out wont help as she will just borrow more on the cleared card its not ur debt!
  • ripongrammargirlripongrammargirl Forumite
    75 Posts
    Part of the Furniture 10 Posts Name Dropper Combo Breaker
    Forumite
    Money should never be lent to friends/family unless a contract is involved that is legal should anything go wrong, although you may well lose friends etc if it had to be enforced.

    Anyway, maybe somebody could correct me on this, but I was under the impression that if you do not spend any more on the card that has just had the interest increased, then the card company had to honour the debt at the original rate until it was repaid? Obviously then though you would lose the credit card when it was repaid but why would anyone stick with a card company that rips off its customers?

    Cut up those nasty credit cards as they are extortionate nowadays. Save the cash instead to pay for things the old fashioned way or ensure you can pay the cards in full every month.
  • Thankfully a very good friend helped me and my family when we were in dire straights and if you cann't trust a friend then who can you certainly not the banks!
  • If you want to stay best friends I would say do not lend the money.It will only create problems if she can't afford to pay you back, and because you are friends you will not want to ask for the money back.You could end up out of pocket and without a friend.
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