Helped a friend....

Muddybum

Thank you foxy-stoat, appreciate the advice and feedback. I've pinged a message off to my 'mate' and we will have a chat when he gets back to me.

I've had a quick look at available loans, should be able to maintain his current payments and be clear in 2 years all being well. You never know, he might have a plan in mind already....I'm not holding my breath though...

I do have a CC I took out after Xmas to balance transfer on, it is no charge and zero% for quite a while, would I be able to transfer to that do you think, makes me a little nervous?

Thanks again
Simon

[Deleted User]

No. You need a money transfer option.

Muddybum

Thanks, thought as much.

fierystormcloud

Muddybum wrote: »

To answer a few questions....

5K is the sum and 60 months is the term.
My friend was genuinely desperate when he approached me and I believed I was helping him out, clearly I was wrong.

I'll look into loans and see about getting us both out of this situation, it pains me but I see no other option...

foxy-stoat wrote: »

Borrowing £5,000 and paying back £13660 ----crikey !

Get another loan or money transfer card NOW...clear this and still get him to make £220 odd monthly payments to you - you will clear the balance much quicker than 5 years.

Get a settlement figure in writing, get him to sign the back of the letter confirming you are lending him the money @ £220 a month for X number of months until the new lending is clear, just in case you need to go to the small claims court.

If he is in a position to get a mortgage before this is paid (unlikely) he should be in a position to pay you a lump of money as he will need thousands for a deposit....unless someone else is gifting him cash to buy a place.

I do not think this chap is YOUR friend....you are a VERY good friend to him though!

Good luck and let us know how you get on.

!!!!!! why? Is that how much 49% over 5 years works out to?!

I have to agree that taking out high interest loans from someone like Amigo is NOT going to help anyone's credit rating. More likely to wreck it!

Not sure I would be paying anything off for him yet though; I mean he hasn't defaulted....... yet.........

'Never a borrower nor a lender be' is the old adage by Shakespeare!

'Never a guarantor nor a lender be,; should be the 21st century one!

Hell would freeze over before I would lend anyone any money or be a guarantor!

What do you mean, by the way, that he is 'only just' paying the loan repayments?

enthusiasticsaver

This was a terrible idea to have taken out the loan in the first place.

Presumably he is a sub prime borrower (hence the high interest rate) and there are posts all over this forum saying do not consolidate debt, let alone on to a loan at that interest rate. Acting as guarantor for it you have opened yourself up to this affecting your credit rating should he default and if he does default Amigo will be chasing you not him. Acting as a guarantor should never be done IMHO.

Having now got into this mess though you have two options. Either wait for him to default and then take the risk this will not impact on you or take out a 0% money transfer card to repay it and get him to set up repayments to you on a regular standing order. Either way though if he fails to make payments you may lose money on this.

Best advice in the future. Do not lend or borrow money from friends.

Shakin_Steve

To anyone thinking of becoming a guarantor, look at it like this: The company are lending you the money, and you are lending it to someone else. If they default, you still have to pay it back, and it will affect your credit file if you don't.
So, in this case, the OP should have visualised handing over five grand in cash to his mate, that would have been sobering.

Muddybum

What do you mean, by the way, that he is 'only just' paying the loan repayments?

He gets paid 2 days after his due date for the loan repayment, so a couple of times he has had to speak to them and agree that he will pay them 2 days late. He has always paid, it just generates a bunch of communication every time which is obviously not great.

I'm sure there will be plenty of folk on this thread who will see this as a warning sign that he will eventually default on a payment and you may be right, I don't know.

Either way I'm looking at ways to extract my self from this situation.

and to echo the comments of contributors and for the benefit of anyone reading this thread in the future...

DO NOT ACT AS A GUARANTOR FOR AN AMIGO OR ANY OTHER PAY DAY LENDER!

Cheers guys
Simon

rhcp

If he pays two days late, then interest will be added for those two days, and interest will be added on to that interest each month, so at 50% there may be a fair bit outstanding at the end of the loan. As you say, best to try to extract yourself from the situation.

Muddybum

If he pays two days late, then interest will be added for those two days, and interest will be added on to that interest each month, so at 50% there may be a fair bit outstanding at the end of the loan. As you say, best to try to extract yourself from the situation.

That explains me not being able to rationalise the repayment amounts that appear to have changed a couple of times, thank you.

They really are ruthless and incidentally their website cites their product as being (and I quote) "Best Credit Builder 2017 (Moneynet)"...

Kind Regards
Simon

27cool

Amigo have no need to chase him if he defaults on the payments. They will be chasing you as the guarantor of the loan. That is the whole point of them only lending to people who have a guarantor.