Loan to Gift to Someone

totallynaive

Hi,

I am currently splitting from a relationship of nine years. My ex has a chunk of debt, and I'd like to help her out by paying it all off. I have a good amount of disposable income each month, but not enough savings to cover everything.

I'd like to take out a loan of £9,000, and immediately transfer the funds to her. I'd like to know what to enter for the purpose of this loan; would it be classed as "debt consolidation", or "other"? My first thought was debt consolidation, but I suppose that no debts are actually being consolidated - I would be taking on some debt in order to provide somebody a gift. With this in mind, should I choose "other" and state "gift" or something similar?

Thanks

AnotherJoe

I would not put debt consolidation in case that raises alarms on your credit record even if in years to come. You wouldnt want that to comes back to bite you with someone dredging up an instance of you having debt problems.

I'd put "home improvements" or something innocuous like that if "other" is not an option.

fromtheshires

When you,say loan to gift to someone, do you literally mean as in gift without any expectation of being paid back at all? If so, that's a nice thing to do, especially for an ex (without knowing the full story mind). Just make sure you really want to do this and can definitely afford it.

totallynaive

AnotherJoe wrote: »

I would not put debt consolidation in case that raises alarms on your credit record even if in years to come. You wouldnt want that to comes back to bite you with someone dredging up an instance of you having debt problems.

I'd put "home improvements" or something innocuous like that if "other" is not an option.

That's a good point about the debt consolidation option. There is an option for "other", but it requires me to enter a short description. I'm wondering what to put in there, and if "gift" would be frowned upon.

AnotherJoe

Are you planning to improve your home perhaps? Sometimes plans can change of course....

yorkshire-lad

I am not too sure about the loan, but my personal opinion would be not to lie about the purpose of a loan.

Can you not just pay your ex monthly payments (similar to payments to a loan) until debt is cleared. The snowball calculator would help with that.

Without getting too much into detail and personal situation. Was the debt racked up by both of you? Is the debt purely in her name or joint?

If its joint then could you just not pay 50% of it rather than full.

If you are set on paying the full debt then you could just get a loan out for yourself, mark it debt consolidation then you contact the companies and pay it off. This way you are also know that it has all been paid off rather than it being spent on a holiday etc.