Money Moral Dilemma: Should I charge my girlfriend interest for a 'loan'?

Erica51

I was outraged to discover that my 26 year old daughter was paying 10% for her car loan when I couldn't get more than two and a half per cent on my savings. I agreed to lend her the money at 4% and we're both better off. As she has an economics degree she could calculate the monthly payment and set up a direct debit. However I have known her for 26 years and wouldn't do this for someone I hadn't known for long.

Prothet_of_Doom

Prothet_of_Doom wrote: »

How much does she want to spend ?

I know where she can get a 1990 honda concerto giffermatic, in beige, with low miles, full dealer service history and 1 owner from new for £300.

If I were you, I'd offer to buy her a similar vehicle, as long as she helps you maintain it, and on the condition that she give it back when she no longer wants it. Or tell her she can "rent" it off you at 10p a mile. - Bill her weekly.

If you know where to look, there are 100's of sub 500 quid cars that will last 3 or 4 years with a bit of TLC.

How about this From this post http://auto!!!!!.com/topic/21415-kia-pride-with-mot-and-low-miles/

dodgytom, on 12 Aug 2015 - 9:51 PM, said:

For sale here is this Kia Pride. I didn`t know they even made them as late as R reg.


62,000 miles with history up to 51,000


Drives very well. Only mechanical faults are blowing exhaust and a very noisy starter motor.


Body very good, small very minor dents but hardly any rust! Needs a t cut..


interior very clean and tidy other than some stitching has come apart but the actual fabric is fine


MoT until December 22nd with only 2 minor advisories on the last one and 5,000 miles covered since


It is in Ludlow, Shropshire


i could do a deal on something else, cash either way


Call or text me on 07805 157 639 if you want a quick reply, I am not online every day


I shall wait a week and then if none of you lot want it I shall sort exhaust and starter and give it a good mopping then £495 it so be quick Attachment P1060612.JPGAttachment P1060611.JPG

VfM4meplse

Potternerd wrote: »

Don't lend it.get her to sort out her own finances. If she can't get a loan it's probably because she's a bad risk.

Agree with this. Aside from emotional manipulation, what makes your girlfriend think that it's right to approach you before a bank?

If she's a poor risk, she should stick to other means of transport until she can afford to buy and maintain her own vehicle.

MadelinesMum

I remortgaged my house to give my partner £20k to pay off debts and he left me soon after.

I'm now stuck paying the mortgage.

Your girlfriend is probably nothing like my ex but you must take into account that there is a chance you may never get the money back.

gloriouslyhappy

lvl68 wrote: »

My parents lent me £1500 for a car, and charged me the interest they would be loosing from the savings account (I paid it back within a year). I didn't have a bad credit rating, but that rate is better than a bank's loan rate and keeps the money in the family! I think it's slightly mean to do that to your kids, but think its the right idea if lending to a brother, for example. but bf/gf is more risky!

Why is is mean to charge your grown-up children interest if you lend them money? First, you're teaching them to manage money, and second, to value relationships. In my experience, and reading this forum, that of many others too, that some children feel entitled to whatever their parents have, without any thought of earning or managing for themselves.

CF5

Delicate matter as you can cause a lot of upset...
I would suggest that you draw some sort of written contract in case you split up (See the cases of Judge Rinder), unless you can afford to loose the money (don't gamble the money you can't afford to loose). Also, somebody said or wrote something along the lines "Relationship starts and stops with honesty"
To answer the question , interest wise you probably get at best 1% from banks so I would avoid this upset, unless it is a decade long loan and 10s of thousands...

Revengant

Don't lend her the money. You've only to watch Judge Judy to easily see that. Isn't she good at saving? There's perhaps a warning there for your future relationship....

Rev.

dirtycredit

cazpost wrote: »

A boyfriend once asked me to take out a £17k loan so that he could buy a car. I declined as I just knew that it could lead to trouble. At the time I could have easily got a loan for that much,but he had a bad credit record and couldn't . Although his earnings were good and he coud have paid me back each month I just didn't feel comfortable about it. He wasn't happy that I said no and it did cause a row but I knew it was the right thing to do . 2 years later we did split up,and if I had lent him the money I would never have got the rest of it back.

Exactly the same..my ex couldn't get credit anywhere even though he earned loads and the reason was that HE NEVER PAID HIS BILLS!! When he aked me to get a loan so he could buy a car i told him to jog right on.

meknowalot-51

She's on the verge of making you look a muppet.Her credit ratings poor or she would go to the bank,this means she has a record of not paying back money thats been loaned to her,now read this again ten times.Do not loan her any money as the percentages are not in your favour.Tell her to save and get the bus and highlight the plus points......no petrol costs,no insurance costs,already she's saving shedloads.You want to end up with someone who's sensible with money so pay close attention to her reaction,it could save you thousands.

Maddox

Wouldn't it just be easier for her to get a loan through 'official channels' like a bank, then you wouldn't have this angst?

Or does she look on you as the interest-free Bank of Boyfriend?

Other posters have made very good points about splitting up etc, all very relevant.