Sister standing guarantor for multiple loans

Hectors_House

I’m sorry to have to bring this to this forum but I’m not sure where else to ask. I tried the Loans forum but got not response to my latest posts on the thread.

During I visit back home in 2019 I found out my sister had stood guarantor for a work colleagues £10,000 loan with Amigo Loans.

Much talking ensued and I thought she understood that she had, potentially put our home at risk as she didn’t have the means to pay back the actual debt of £24,000.

We own the home together and it is mortgage-free.

This November just gone I spent the lockdown with her and found a letter, unopened from a solicitor. I asked her permission to open it and it was another lender calling in another loan that the borrower had defaulted on. This time they wanted just shy of £10,000.

Three months after we spoke about the Amigo Loan she stood guarantor for a £4,500 loan for the first ladies daughter - this time with Guarantormyloan.

I wrote Letters of Complaint to both companies and they started to look into that.

Guarantormyloan wrote a long letter that again sat unopened until our Father found it and sent it to me.

Since 2017 my sister has stood guarantor six times for these women
- once for the Mother and five times for the daughter (including another loan with Buddy Loans).

My sister has been taking very strong meds for depression, anxiety and epilepsy for many years now and was diagnosed with a low-grade cancer back in 2012. These women knew about all of this.

I am now very worried. I don’t know what is going to crop up next.

When I asked her why she did it she says these are her friends and she didn’t want to let them down.

Help!!!

Pollycat

What help are you looking y?
Your sister is liable for the debts if the person whose name the loan is in defaults on the payment.

Hectors_House

Pollycat said:

What help are you looking y?
Your sister is liable for the debts if the person whose name the loan is in defaults on the payment.

I understand that Pollycat but I could be forced to agree to the house being sold to pay these debts and that would leave us both homeless. Having found seven to date I’m wanting advise on what to do to stop people taking advantage of my sister.

pramsay13

If your sister does not have capacity to make decisions like this you will need to look at financial guardianship (in Scotland. Not sure what it's called elsewhere). You could then maybe go back to the loan companies.
If she does and she has made a bad decision she will need to repay the loan.
If she doesn't have enough spare she might need to look at borrowing against the house.
What are the friend and her daughter saying about it?

Hectors_House

pramsay13 said:

If your sister does not have capacity to make decisions like this you will need to look at financial guardianship (in Scotland. Not sure what it's called elsewhere). You could then maybe go back to the loan companies.
If she does and she has made a bad decision she will need to repay the loan.
If she doesn't have enough spare she might need to look at borrowing against the house.
What are the friend and her daughter saying about it?

She asked the daughter what was going on when she realised she had stopped paying the debt. The daughter sent her a text (that I saw) telling my sister that her outgoings were £600 more than she earns.

I’m not sure how the lender thought she was able to afford more debt.

Guarantirmyloan who gave most of these loans to the daughter have responded saying they will release my sister from the loan thankfully. We are waiting to see what Amigo say.

My concern is my sister will agree to guaranteeing more debt for these women if they approach her again.

Im beginning to think we will have to look into some sort of Power of Attorney because this behaviour isn’t rational surely.

elsien

Unwise decisions do not mean lack of capacity. There is a presumption in law that someone has capacity unless evidenced otherwise.
And power of attorney has to be freely given, it can’t be enforced on the person. Without it, if there were genuine concerns that she did not have capacity around finances then that would need to be clearly evidenced and an application made to the court of protection, a long and slow process. (England and Wales.)

Does she have any support for the mental health issues - would she be willing to talk to someone professional about the situation? Would she allow you/another family member to talk to the people in question with her, and make it clear there won’t be any more guarantees?
 Is she telling the truth on the  guarantor forms? 

Hectors_House

elsien said:

Unwise decisions do not mean lack of capacity. There is a presumption in law that someone has capacity unless evidenced otherwise.
And power of attorney has to be freely given, it can’t be enforced on the person. Without it, if there were genuine concerns that she did not have capacity around finances then that would need to be clearly evidenced and an application made to the court of protection, a long and slow process. (England and Wales.)

Does she have any support for the mental health issues - would she be willing to talk to someone professional about the situation? Would she allow you/another family member to talk to the people in question with her, and make it clear there won’t be any more guarantees?
 Is she telling the truth on the  guarantor forms? 

She lied on the last form (the loan the daughter defaulted on).

it looks like the lender started to get concerned cus them asked her if she was guarantor for any other loans and she said she wasn’t.

The first they knew about her covering the woman’s Mother’s loan was when they got the Letter of Complaint.

I have asked her to take her name off the deeds to the house when this is all sorted. She agreed.

She has been having help with her mental health issues.

elsien

While understanding your concern about a forced sale of the house, taking half a house off her could also be construed as taking advantage. 

What are you going to put in place to protect her share? 

MovingForwards

https://forums.moneysavingexpert.com/discussion/6214948/guarantor-loans/p1

Lots of useful information provided by people and more background provided by OP.

Hectors_House

elsien said:

While understanding your concern about a forced sale of the house, taking half a house off her could also be construed as taking advantage. 

What are you going to put in place to protect her share? 

I will update my Will leaving the house to her. She’s my sister and I wouldn’t rip her off. I’m surprised that people could think that.

MalMonroe

I'm so sorry for your poor sister and that those awful women are continuing to harass and take advantage of her. They need to be stopped. Is it possible for some kind of restraining order to be issued against them by the police? Their actions are not helping your sister's health, either physical or mental.

As has been discussed on the other thread, the Ombudsman has the power to release guarantors where they have been coerced into signing. It's obvious that those two women were not in any position to pay back loans at any time - have you tried appealing to the Ombudsman? There's also this - https://debtcamel.co.uk/amigo-ombudsman-released-guarantor/  and although it's from 2019 it seems that things have only got better for guarantors since then. Especially when Amigo were involved.

I see you say your sister has been having help with her mental health issues and I do hope that's continuing as it doesn't appear that she's been managing very well on her own. Being in lockdown won't help.

I hope things get sorted and that your sister receives all the support she's entitled to and deserves.