*Borrowing Money to an Unmarried Partner: New House*

julieb1987

DRP wrote: »

if your partner (the owner) is living at the property , you will be a lodger rather than a tenant - you cannot have an AST so very little protection (if any) from being chucked out.

That's what I thought. If you don't trust your partner to not chuck you out, I wouldn't be lending him/her £10,000 either. If it goes t**s up, you're the one who will suffer!

paddyz

Not sure if im reading this right have you already given her the 10k if so sounds like you are too late to do this

Plus If you are moving in why not set up a agreement to live not paying anything for a period of time until your 10k is paid back.

MonSaveHelp

paddyz wrote: »

Not sure if im reading this right have you already given her the 10k if so sounds like you are too late to do this

Nope, money has not been provided yet. Will do in the near term. Hence would like to ensure I have some kind of agreement in place. An unsecured agreement is better than nothing.

paddyz wrote: »

Plus If you are moving in why not set up a agreement to live not paying anything for a period of time until your 10k is paid back.

Good thinking. But because the solicitor and other fees are due now will have to provide the money now. I assume the best path is a unsecured loan agreement now and (partner permitting) a 2nd charge secured loan agreement later.

I am hoping the bank lender will permit this (as I understand that they should be notified if there any additional second charges on placed on the property register).

missile

There may be trouble ahead: "I lent my partner money to buy the house, he has kicked me out, has a new girl friend and refuses to pay me back"

Nobbie1967

Why doen't your partner get a loan for the £10k? You could in effect pay the repayments as your 'rent' If it all goes to rats then they're responsible for the debt

Kayles86

Are you sure £10k is not quite in excess of what the fees would be? I am purchasing a house at the moment and the solicitors fees are only about £1k (shudder at the word "only"), granted there is stampy duty on top. May be worth getting a quotation of fees as you may be more comfortable lending a considerably lower sum

MonSaveHelp

Nobbie1967 wrote: »

Why doen't your partner get a loan for the £10k? You could in effect pay the repayments as your 'rent' If it all goes to rats then they're responsible for the debt

Hmmm.. sounds good, but that loan will probably have costs associated to it which are avoidable if I lent the money. Also not sure if they will qualify for any more loans as they are max'ed out with the property purchase.

The individual is very trustworthy, I have known them for 5yrs. But in case they get hit by a bus (perish the thought), I would need some way of claiming from their estate.

MonSaveHelp

Kayles86 wrote: »

Are you sure £10k is not quite in excess of what the fees would be? I am purchasing a house at the moment and the solicitors fees are only about £1k (shudder at the word "only"), granted there is stampy duty on top. May be worth getting a quotation of fees as you may be more comfortable lending a considerably lower sum

Thanks. Will check. I think its fees + stamp duty, but will find out today/tomorrow.

Appreciate the forum replies, helps ensure I have all bases covered.

caeler

Read this:
http://www.thisismoney.co.uk/money/experts/article-2145901/Can-I-force-ex-boyfriend-pay-3-000-loan.html
Sounds like pretty sensible advice on how to put together enough evidence in advance to enable a future claim.
I do hope this is never necessary but I admire your courage to put something down which tries to secure your investment in your future. Good luck.

MonSaveHelp

caeler wrote: »

Read this:
http://www.thisismoney.co.uk/money/experts/article-2145901/Can-I-force-ex-boyfriend-pay-3-000-loan.html
Sounds like pretty sensible advice on how to put together enough evidence in advance to enable a future claim.
I do hope this is never necessary but I admire your courage to put something down which tries to secure your investment in your future. Good luck.

Thanks for past feedback.

I put together the below Loan Agreement as I had to lend the money in a rush. Tried to term it as an investment based loan, if the property value goes up, I benefit as well.

Welcome any feedback anyone has on it?...

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LOAN AGREEMENT

This Secure Loan Agreement (“Agreement”) is made effective the date: <Date>

BETWEEN:
<Name> (the “Lender”) an individual with the main current address located at: <Address>
AND:
<Name> (the “Borrower”) an individual with the main current address located at: <Address>

1. PROMISE TO PAY
Borrower wishes to borrow £10,000 GBP, known as “Loan,” from Lender. The Loan will be furnished to Borrower.

2. CONDITIONS OF THE LOAN
The Lender will have the right to charge interest for the Loan. The Lender will provide a Loan demand notice letter to the Borrower stipulating immediate payment or providing payment terms for the Loan repayment(s). The Loan demand notice letter will be served to the Borrower or sent to the last known address of the Borrower and the Borrower agrees to repay the Loan as per conditions in the Loan demand notice letter with earlier repayment acceptance at the discretion of the Lender. If the Borrower is the registered proprietor of <Address> (known as the “Property”), the Borrower agrees to secure the Loan against the Property via a charge against the Property and the Borrower agrees to provide the Lender or his representative the right to reside at the Property. That unless otherwise agreed so long as any amount remains owing to the Lender the Borrower will keep the Property and fixtures & fittings in good repair and condition and that the Borrower will not cause or permit any person to be registered under the Land Registration Acts as the proprietor of the Property or lease any part thereof of the Property without the consent in writing of the Lender. The Borrower will keep the Lender fully indemnified in respect of any breach or non-observance of the covenants related to the Property.

3. REPAYMENT
The Borrower agrees that the Lender, or a representative of the Lender, has the right to request payment for the whole outstanding Loan amount or part thereof at any time by serving or sending a Loan demand notice letter to the Borrower stipulating this requirement. When a Loan demand notice has been served to the Borrower, the Lender and Borrower shall agree a figure in respect of the value of the Property (assuming a willing seller to a willing buyer with vacant possession) and in default of agreement the value shall be determined by an independent valuer appointed at the joint expense of the parties hereto by the President of the Royal Institution of Chartered Surveyors whose decision shall be final and upon satisfactory receipt by the Lender of the specified Property value the Loan amount payable shall be adjusted as a proportion of any increased value.

4. LATE CHARGE
Any late charge(s) will be stipulated in the Loan demand notice letter to the Borrower.

5. DEFAULT
If for any reason the Borrower fails to make payment on time, the Borrower shall be in default. The Lender can then demand immediate payment of the entire remaining unpaid balance of this Loan, without giving any further notice. If the Borrower has not paid the full amount of the Loan when the final payment is due, the Borrower will pay the Lender additional interest on the unpaid balance at a rate stipulated by the Lender.

6. RIGHT OF OFFSET
If this Loan becomes past due, the Lender will have the right to pay this Loan from any deposit or security the Borrower has with this Lender without notice. If the Lender provides an extension of time to pay this Loan, the Borrower still must replay the entire Loan.

7. COLLECTION COSTS
The Borrower agrees that all complete costs, expenses, and expenditures included, and (without limitation) legal costs incurred by the Lender in enforcing this Agreement as a result of any default by the Borrower, will be added to the principal and the outstanding will become immediately payable by the Borrower.

8. BINDING
This agreement will ensure to the benefit of and be binding upon the respective heirs, executors, administrators, successors, and assignees of the Borrower.

9. NOTIFICATION
The Borrower will provide the Lender the last known address of the Borrower. Any notice(s) or Loan Demand letter(s) under this Agreement shall be deemed sufficiently served if served to the Borrower in person, or if served via post to the last known address shall be deemed to be received forty eight hours after posting.

LENDER:

Signature: _____________________________

Print Name: _____________________________

Date: ______________________

BORROWER:

Signature: _____________________________

Print Name: _____________________________

Date: _____________________

Borrower and Lender agree to the conditions above, and sign to that effect in the presence of a witness:

WITNESS:

Signature: _____________________________

Print Name: _____________________________

Date: ______________________

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