Loan to Friend-what shall I do?

poppasmurf_bewdley

The fact that the 'friend' needs £3k to bolster their deposit on a mortgage is a clear indication to me that the 'friend' is overstretching him or her self on the purchase of a house.

If they can't get the deposit together without borrowing, then how can you be sure they can afford to meet the regular commitments required to buy and own a home?

Also, the fact that the 'friend' only contacted your wife instead of both of you would be another indication to me that all was not well.

Approaching anybody like this smacks of desperation where all other avenues have been closed off to the 'friend'.

Mr_bob

Thank you for all the welcomed comments so far. I was so desperate this morning to speak with someone, I decided to come on here for neutral unbias advice. Its been brilliant so now Im trying to put together what to say when I speak with her?

tiger_eyes

Mr_bob wrote: »

Thank you for all the welcomed comments so far. I was so desperate this morning to speak with someone, I decided to come on here for neutral unbias advice. Its been brilliant so now Im trying to put together what to say when I speak with her?

• That lending money to friends often ends the friendship. If the friend can't or won't repay, they will break off contact out of embarrassment.
• That you (as a couple) should only lend what you can genuinely afford to lose, in which case it would be better to make a complete gift of the money with no conditions attached.
• That a mortgage lender will in any case most likely not accept a loan as part of a deposit.
• And that if she genuinely wants to help them, she could try offering to help pack or something similar.
• And that you'd like to be consulted in future over lending (or spending) substantial amounts of money.

Nice calm discussion.

dealer_wins

Another way to gracefully say no would be to say that something has come up and you now need the £3000.00. Family member ill abroad and need to send it, new boiler, new car etc

AnotherJoe

Let us know how it works our Mr Bob.

LoveLifeAgain

tiger_eyes wrote: »

• That lending money to friends often ends the friendship. If the friend can't or won't repay, they will break off contact out of embarrassment.
• That you (as a couple) should only lend what you can genuinely afford to lose, in which case it would be better to make a complete gift of the money with no conditions attached.
• That a mortgage lender will in any case most likely not accept a loan as part of a deposit.
• And that if she genuinely wants to help them, she could try offering to help pack or something similar.
• And that you'd like to be consulted in future over lending (or spending) substantial amounts of money.

Nice calm discussion.

I agree with this. I have seen so many times over the years this has been the end not just of friendships but close family ties too. Very naughty to offer without discussing it with you, but I agree that a calm talk, maybe mentioning your disappointment and hurt feelings rather than anger would be better.
Of course, they could pay up and all is well.
Good luck

Mr_bob

AnotherJoe wrote: »

Let us know how it works our Mr Bob.

Certainly will, thanks again.

glennstar

Mr_bob wrote: »

thank you for the advice..

Could you please tell me what this means?

I was ineloquently suggesting that there was no legal mechanism to circumvent the inevitable outcome of this situation and that anyone suggesting they are happy to sign things is generally a reflection of their need rather than their desire. Signing a letter drawn up by a Solicitor is like any other contract and you would have to turn to the the usual channels to seek a remedy - which rather puts you back at square one.

DCFC79

I also wouldn't lend/gift the money bob.

CKhalvashi

DCFC79 wrote: »

I also wouldn't lend/gift the money bob.

Me too.

Whilst I'm happy to do work for friends, or ask them to work for me on an 'it'll get/can it be invoiced at the end of the month' basis, lending to friends where there's no 'service' involved is IMO very likely to end in tears (for you, not them)