Dilemma - let Girlfriend's parents pay off loan?

wantsajob

Ok, well I'll set the scene of how I ended up with the loan, and why I am having difficulty repaying.

I studied at University and achieved a first class honours degree. On applying for jobs and going to interviews I wasn't having much success, whether I applied for jobs related to my qualifications that paid over £25k a year, or unskilled jobs at minimum wage end. At the time I did not lend much weight to this being due to my disability (Asperger Syndrome) thinking positively that my difficulties would be something I could overcome given time. I thought what might help would be another qualification to set me apart from other applicants so I went to study a Masters. I also thoughtlessly hoped studying further may help me overcome some of my difficulties due to Asperger Syndrome, improving my chances at interview. In fact the reverse has happened and accepting that being unemployable is due to a disability I cannot control is rather depressing. I am often not inclined to apply for jobs as they usually state a requirement for good interpersonal and communication skills, even if the job does not require them. Ultimately, I believe that my lack of these skills, plus the fact I do not come across well in interviews (both due to disability), are the only reasons I have never been offered a job. It is certainly the reasoning given in any post interview feedback I receive. Anyway, enough of that - basically getting paid work is not easy due to disability.

In order to do the Masters course I had to pay fees, for which I got a career development loan from Barclays, in total it was for £8000. Being unemployed on completing the course, I took all the possible payment holidays (18 months), which as I understand were still interest free for that time. As you can probably imagine I now regret having done the Masters at all because of the financial issues, and lack of any apparent benefit in getting a job. Sadly there is no time machine so I can go back and tell myself DON'T DO IT, so I have to deal with things as they are.

I currently pay £90 a month which I understand just covers the interest on the loan. I had originally planned to get another loan with a cheap rate (in this glowing imaginary future in which I had a job) with which I could pay the CDL straight off, but with the worldwide credit crisis and being unemployed that's a no go. The only income I have is from Working Tax Credits paid to my partner including myself with her as a couple.

My girlfriend, whom I have been with for over 3 years, reluctantly told me that her Dad mentioned he had offered to pay off the loan if it was under a certain amount (I do not know if that amount reflects their total savings [I hope not] but it isn't all that much more than I expect the total settlement figure would be), and then I could pay him instead with no request for interest. I would of course like to pay more if I took up the offer, at least the amount it would have earned in a good savings account as clearly this is money they would have missed out on. Either way it's better than the approx 30% APR Barclays are charging, with interest also slapped on top of the arrears due to paying less than originally agreed, due to being unemployed (again I had bright wonderful visions of getting a job quickly and paying it off fast so at the time selected the shortest repayment period). I wouldn't say her parents were well off but they're the type who are good with their money. Both are now retired so not earning much.

It's quite a dilemma. Do I continue to effectively chuck £90 in the bin every month for as long as I am unemployed (foreseeable future), and in the end pay however much extra to Barclays for the privilege of borrowing money from them and to avoid any negative feelings from borrowing from my GF's family? Or accept a large sum of money from my GF's parents, knowing that they have little money coming in themselves and that this probably represents the majority of their savings and the chance for them to have a nice holiday or buy a new car etc? I know their heart is in the right place and they're genuine people, but I can't help feeling it would end up biting me in the bum at numerous points in the future in some way. I think they also have a vendetta against Barclays :rotfl: which is probably one of their reasons for offering.

What do you think?

Barricade

My personal opinion is that if they are offering, then they have possibly looked at their own finances to see if it is suitable.
If it was me then I would accept, on the understanding that a contract (simple 1 or 2 page info) is drawn up whereby you agree the amount you owe them, and the kind of payments you are making per month.

As you rightly said, its much better than the 30% barclays are going for!
It is a very kind and generous offer, and one I could only wish for.

Good Luck.

wantsajob

Barricade wrote: »

My personal opinion is that if they are offering, then they have possibly looked at their own finances to see if it is suitable.

Now you mention it ISTR they were budgeting for remedial work to their house and a new central heating system etc so perhaps you are correct.

Perhaps if I were to not take up the offer it would be just for some pointless male macho "I got myself out of that mess" reason than being the most logical course of action.

Thanks for your thoughts

Mr.Mulla

Pretty tough situation. I can understand your dilemma well. I would suggest that you discuss it with your partner, or if possible, with her parents as well so you can asses the situation well. By situation I meant their financial status, can they afford to let you have this loan without causing them financial difficulty in the long run? And your financial capacity to pay as well on a regular basis. After knowing the answer to those, you will know which will be the best thing to do.

Good luck.

wantsajob

And true to the dilemma the votes are split 50/50 at present.

CatB_2

Mr.Mulla wrote: »

Pretty tough situation. I can understand your dilemma well. I would suggest that you discuss it with your partner, or if possible, with her parents as well so you can asses the situation well. By situation I meant their financial status, can they afford to let you have this loan without causing them financial difficulty in the long run? And your financial capacity to pay as well on a regular basis. After knowing the answer to those, you will know which will be the best thing to do.

Good luck.

I would agree with the above. It's important to you to know how well they can mange it.

I would also say that it depends on the strength of your relationship with your girlfriend and her family, if you have been together a long time, you are a part of the family and they are hating watching you struggle hence the offer - then I'd go for it. It will make them happier, seeing their daughter happier because you are less stressed and possibly makes finacial sense for them too to give you a managed long term loan than help helping you and your girlfriend out with stuff occasionally because all your money is being spent in interest.

If you haven't been together long, it's a spur of the moment offer, they might want it back suddenly if you slipt or she might use it as everlasting emotional blackmail - probably not worth it.

Also - don't give up on the job front - my ex has AS (well - almost certainly - he would never actually get it formally diagnosed) and has actually landed his dream job - he gets to dodge his birthday and Christmas most years by spending them on a ship in the Antarctic! PM me if you want to talk more on this subject.

Tixy

Personally I wouldn't.

Whilst I am certain you have every intention of paying them back what happens if there is no way you can raise the cash some months to pay it back. Or you split from daughter and they need it back quicker or well anything really. If you were hit by that oft mentioned bus tomorrow and were killed they would have wasted their savings.
Plus the fact that your girlfriend was reluctant to mention it to you, makes it sound like she is not supportive of the idea.


Have you been applying for entry level jobs as well as graduate jobs?
If you think that there is no chance that you will get any job for the foreseeable future and in view of your circumstances then I would take some debt advice from one of the charities, and discuss your options with them, possibly even considering a DRO.

MrsPorridge

OK - I wouldn't take them up on their offer either. Many years ago my Dad loaned me some money interest free and I paid him back a certain amount each month. I used to go on holidays and go out during this time (I was working). Mum always used to say "how can you afford to do so and so when you owe Dad that money". Despite the fact that the sum was agreed with Dad it made me feel dreadful. In the end I would go out and not tell them what I was doing (I wasn't living with them). I eventually managed to pay back the money I owed much earlier than expected and from that second onwards vowed never, ever again to borrow from family. But, that's just me.

I guess what I'm trying to say is - you will always be beholden to them while you owe them. In fact you said in your earlier post about it "coming back to bite you in the bum".

Its really generous of them but do think long and hard about this decision.

wantsajob

MrsPorridge wrote: »

Mum always used to say "how can you afford to do so and so when you owe Dad that money". Despite the fact that the sum was agreed with Dad it made me feel dreadful.

I guess this comes about the top of worries. Plus they are already generous enough and pay for drinks and meals if we go somewhere.

When/if I get a job my aim would be to clear the loan ASAP whoever the lender is as I know getting rid of a debt makes sense. Even at minimum wage I expect it could be easily cleared within 2 years (although the temptation would be there to put the money towards moving to live somewhere nicer, a better TV etc [which is where I guess the point above comes in]).

The only financial obligation I don't need to worry too much about is the undergraduate student loan from the Student Loans Company as I need to be earning £15k+ before that starts getting paid, and even then it's only a percentage of the amount earned above that. It's looking ominous that this will ever be paid at all unless perhaps minimum wage goes up,

SuzySu

I wouldn't either. It's much easier to deal with an anonymous company/person if things get really bad. What happens if you and your girlfriend split up? You have the stress of that as well as still having the ties of owing her parents a large sum of money.

themull1

i wouldn't, circumstances can change, you don't want to be split up from girlfriend and still be paying a loan to her parents.!! what about your parents?