Loan for family member

john14_2

My son has a poor credit rating and so can only get a loan with a high interest rate. My credit rating is excellent. If I take out a loan to enable him to carry out home improvements:
a) is it better to keep the money in my account and pay the bills as they arrive,
b) if I simply transferred the whole sum into his account so that he can handle everything for himself, are there any tax implications for either of us?

Would welcome accurate advice. Thanks.

jonesMUFCforever

My best advice is don't do it.
If he is unable to get a decent loan rate it is because he cannot afford it!

If you insist on lending then do it as your point a). This will mean that it does get used for the true intention. Giving him all the money in one may lead to other temptation.

I would also get a written agreement to state that you are lending your son the money in case of any family rifts later on.

janeawej

my mum would always say dont lend what you cant afford to lose and I have to say this has stood me in good stead over the years