Lending to family/spouse - what should I know beforehand?

kerrirobberts

Could you buy a second hand car... 2-3yr old not an old banger, then get him to pay the car allowance into a no access high interest savings or isa account and put it towards the wedding, honeymoon, holiday, having kids, buying another car when it's equivalent to the cost of the initial car etc? Interest prices at the moment are shot anyway, and would give you something to plan and look forward to. If it gets paid straight in on his payday as a standing order then you needn't worry that he's spent it before it goes out.

dellbell

Your in a very serious relationship, So my advice give him the money as you will have to learn to share the finances eventually and as you say WE need a new car.

LovelyLeeds

ManicMum wrote: »

Get a joint account then it's not an issue anymore.

I would not recommend that at all. Don't do it full stop - there are enough threads (the friends and family one is 'stickied') plus loads of others - some of which are wind-ups but nonetheless relevant with the end answer - DON'T DO IT.

rtho782

WalletFullOfMoths wrote: »

I see Martin Lewis kicked off an entire parliamentary investigation into this ridiculous practise

Do you have a link to this?

I'm quite interested....

leimichellecat

I agree with McKneff's advice, when my husband was my fiance, he needed a car but due to him only working for a couple of months it wasnt worth the loan repayments in his name, so i bought myself a second car which he drives, and I just take money from his bank account ever month. Now he is a student, he would never have been able to afford the repayments so has worked out quite nicely, i just continue to take 'hire' money from his account. All the paper work for the car etc is in my name, however I do plan to change it over to his name when he has finished university (graduation present!)

somethingcorporate

I am surprised that you think that credit searches should not appear on credit files - it is a useful bit of information that a lender can use to determine whether to lend.

Single searches barely touch your file, if you have a lot in a short space of time it may indicate desperation and this is something that a lender may want to know before advancing funds.

Good luck.

RobertoMoir

somethingcorporate wrote: »

Your venom towards the banks in this situation is misguided. You have no "right" to see their internal workings nor to their money.

Read O4Us linked thread and then don't do it.

This is good advice. The bank are in business to make money. They want to find people to lend money to and charge for that privilege because that's one way they make money. If they will not loan to your other half, or will only do so at an expensive rate, then this is because they have hard rational reasons to believe they are a bad credit risk.

They won't have "screwed him out of his right to a cheap loan" because they're evil or they didn't like his face or whatever. There's a reason hidden somewhere in your OH's financial history that explains why the banks think they are a poor credit risk. Now you may well disagree with their reasoning here. You may well be right. But before you lend him any money you need to get your head around that fact in order to judge your own risk here.

I actually kinda agree with DellBell: don't lend him any money that you can't afford to give him as part of you both having a life together anyway.

InsideInsurance

So, just to make sure I am understanding it correctly.... you are about to enter into the contract of marriage who's terms and conditions are normally roughly " to have and to hold, from this day forward, for better, for worse, for richer, for poorer, in sickness and in health, until death do us part" but you are concerned about financially contributing to a car?

Whilst a bit of cynacism can be good, I think you've got much bigger problems than if you get repayment or not of some money.

WalletFullOfMoths

Just returned to this thread...

An interesting mix of replies.

Thank you to all of you concerned about our relationship, but I can assure you it's very healthy. There are very logical reasons why we are keeping finances separate, but these are also personal so forgive me if I don't share them with a wider audience.

somethingcorporate, robertomoir - There is obviously something that the banks have decided make my fiance 'high risk', although ironically his credit file is squeaky clean. It could be that he lived on the wrong side of the street or has too many letters in his name. Who knows. I'm not questioning banks right to lend money, or not, as they see fit. I'm not from the 'me' generation :-) But it is wrong for banks to follow practices that dissuade consumers from shopping around; in this case adding a request for a loan rate to a consumer's credit history. It's just not necessary.

rtho782 - unfortunately the site won't let me post links because I am new, but try looking up Treasury Committee launches inquiry into Credit Searches in conjunction with MSE on this site, and also take a look at the Select Committee Report at the parliament.uk site - add this to the URL: /business/committees/committee-a-z/commons-select/treasury-committee/inquiries1/former-inquiries/credit-searches/ Admittedly a couple of years old now, but it seems that little has changed.

For the record, all you bankers can rest easy. He went for the (expensive) loan. It was just too complicated with the risk of tarnishing his credit file, plus the tax implications, company policy on car ownership/fuel cards and not wanting his kids to trash what would, in effect, be my car should I have paid for it.

LovelyLeeds

WalletFullOfMoths wrote: »

For the record, all you bankers can rest easy. He went for the (expensive) loan. It was just too complicated with the risk of tarnishing his credit file, plus the tax implications, company policy on car ownership/fuel cards and not wanting his kids to trash what would, in effect, be my car should I have paid for it.

Thanks for coming back to let us know - another happy ending on the Loans Forum.:T:o:T