Family Debt

Lunarsky20

Hi all,

This may be a long one, so apologies in advance, but I really need some help. 

I am in a very difficult situation at the moment. My partner and I were renting for 5 years (the rent was £725). We experienced a lot of financial difficulty, ran up a lot of credit cards, and had a few loans. We tried to consolidate the credit card debts with loans, but eventually, we ran into further issues and ended up using credit cards. We were only able to pay the minimums on the credit cards, and then we had 2-3 loans coming out as well. Every month was really difficult and we struggled. It really affected my mental health and I was always worried about money and whether we would be able to keep up with our payments. We also have no savings as a result of the debt.

Fast forward to a few months ago, my partner and I came up with an idea to use the money that my parents had set aside for a house deposit to pay off the debts. My parents were not aware of my financial problems, and I was too ashamed to go to them for help. My partner insisted that it was none of their business and that we could try and cope. My partner and I had found a house we really liked, and we proceeded with this with the help of a mortgage broker. We explained to the mortgage broker that we had debts, and we told him we had an idea of using the house fund my parents had set aside for me to use to pay off the debts, and he agreed that we could do this and this would enable us to buy the house. At the time, my father was receiving palliative care, and our family was going through a lot, so I hadn't really thought about the implications of doing what I did. 

We received the money from my mum, and we used this to pay the debts off. However, we did not have enough to clear everything. We borrowed a large amount of money from my partner's father to cover the rest and to use towards the house deposit. I have some money in a fixed savings account which my parents gave me towards the house, and my partner said I need to pay this to his father to repay the money he lent to us. This was verbally agreed upon despite my concerns about it. The house purchase went through, with the help of both our parents (who don't know our financial situation).

However, in January, we were struggling as we did not have a pot of savings to use for solicitors fees, so my partner and I had to resort to using other funds. We had some difficulties moving into our house (new build) as there were some issues with the house, so our move was delayed while they fixed the issues. Since living temporarily back with my mum, unbeknown to me, my partner decided to borrow a further loan from his father to pay down the credit cards he had used recently. The loan amount is now £50,000 (with £20,000 being expected to pay his father back in April from my fixed savings account). 

Since living with my mum whilst the house gets sorted out, I have now finally been able to admit to her what we have done with the house deposit and she was incredibly hurt, upset and betrayed by us. I feel ashamed and feel disgusted by what I have done, but during the time this was all going on, I was heavily manipulated by my partner and was also grieving for my father, who had passed away in November. I feel like my partner took advantage of me and my mum during a very difficult time. I have sat down and accessed the situation by doing a budget spreadsheet, and I am very concerned and worried that based on the loan repayment we have agreed with his dad, our mortgage and bills, and also trying to plan a wedding (we are suppose to be getting married in May 2025), we will not be able to make ends meet. My partner and I were living beyond our means before and he isn't willing to change our lifestyle at all. I tried to discuss my concerns with my partner, but he is adamant that we do not have any debt despite my trying to explain that owing his dad money over the next 5-6 years is still a debt. Our relationship is starting to become a bit fractured as well from the strain of discussing money and money problems, and I am starting to see a very ugly side to him. I am starting to think he's been manipulating me the whole time and I just didn't see it. We have been together 7 years this year. I am considering leaving him as the money situation is getting out of hand and he does tend to spend a lot of money on things we don't need, despite me asking him not to buy the item. Sometimes he buys the item without me knowing and I then find out afterwards when I see the item unpackaged, by which point it's too late to even try to return. 

I am unsure on what to do with the loan repayments we borrowed from my partner's father as I don't want to hand over the £20K I have in savings as this was given to me by my mum. I am questioning the whole relationship and I am struggling to make my partner see how serious this could be and become later down the line. He won't even go to a Debt Advisor or anything as he's convinced our financial situation is 'fine' and that we have no debt. I am wondering whether I end the relationship or not and how this would affect me financially. We may have to sell the house if the relationship breaks down which is also another stressful thing to think about and also expensive to try and get out of. I realise I've covered a lot here but I'm hoping I could seek some advice on what to do. 

I really need help and advice on this! 

Keep_pedalling

I presume your partners father signed a declaration that his ‘loan’ was a gift to enable you to get mortgage, so frankly he is stuffed and you don’t need to repay him.

MattMattMattUK

The debt itself is a major issue, but I am not sure any of us can help with that at the moment as it is a symptom not a cause.

I would really suggest that you read the link below on money in relationships and that you also both attend counselling, if you do end up buying a property together both your financial situation and your relationship are only likely to deteriorate further. You are likely going to have to make some hard decisions but from reading your post I think you already know what that decision is. 

https://www.relate.org.uk/get-help/talking-about-money-your-relationship

https://www.relate.org.uk/what-we-do/counselling/relationship-counselling

EssexHebridean

I'm sad to say that from the debt perspective alone, you are victims of the consolidation trap - it's sold to people as a magic fix to "clear" debt - but all too often what it really is is a sticking plaster and a shortcut to ending up ion even more debt. Had you come here at the point you were considering it, we would have explained why it was a poor idea.

For my money - the first thing you need to do is to cancel the plans for the wedding right now. Regardless of everything else - right now is just not the right time to be considering marrying, quite clearly. You need to work through a lot of stuff before considering taking the relationship to that level. Don't fret about what anyone else might think about this - just do the thing that is right for the two of you. 

Although the control aspect you are concerned about is a potential red flag, right now I'd suggest that you need to take a step back. Ultimately, the decision to use the money WAS yours too - and while you regret it now, is it really fair to shift the blame almost fully to your partner? You've been through a lot of incredibly stressful situations recently - bereavement, and buying a house - both right up there with the most stressful situations in life. Money troubles too - it's generally underestimated how much stress and anxiety that causes. I would strongly suggest that the main thing to do is to get your finances straight - by way of a proper household budget, and some frank conversations. Things to bear in mind - your partner might well be feeling much the same way you are. "No" is a complete sentence all on its own. While your Mum feels cheated and hurt now - ultimately she will stand by you. You do need to be careful telling her that it's all your partner's fault though - as if you do come out of the other side of this and ultimately stay together, that will likely make for tricky family relations in the future. 

I would suggest that you put together your SOA (statement of affairs) using the link to the calculator below in my signature. Make it open and honest - don't put things in that you feel you "should" be budgeting for if you're not currently, and never mind what anyone else "expects" to see there - just set out how thigs are at the moment, format for MSE, copy & paste into the thread, and let's see if we can find a way forwards on the financial front at least.

Ultimately, it might be that once you've got your head in the right place, you decide that things aren't right with your partner and you decide that splitting up is the right thing - but don't make that decision from a position of stress and anxiety being fuelled by other aspects. 

enthusiasticsaver

I would say that cancelling the wedding and talking to your partner about whether your relationship will work is the first step as it sounds like financially you will always struggle if he denies you have a problem with overspending and hides things from you.  The issue of the  your partners fathers loan is between them.  Do you have joint finances or separate?  I would do an soa as a first step and certainly do not hand over any of your mums  money or savings. If he spent the money on credit cards I would leave him to sort out repaying that either by agreeing with his father a different loan repayment schedule.  I would also separate my finances at that point.  

The debt consolidation route never works as it does not get you to change spending habits so as in your case the debt built back up again.  It makes things worse ultimately. 

Sadly I don't see that you will make any headway if your partner refuses to change lifestyle and is so gung ho about borrowing to cover his overspending. Lying to you about spending would be the final straw for me.  Have you actually completed on the house? 

gwynlas

I would say that you should approach Womens Aid as i fear that you are a victim of coercive control unless you willingly agreed to defraud your parents when in debt. However even if you did by your partner trying to tie you into further debt with his father this is continuing, You are probably not really open to advice and too invested in a  future with your partner to listen to strangers on a forum. Your financial situation is quite common as many couples see life through rose coloured gladdes putting possessions and a brand new house before the practicalities of marriage and parenthood. Ditch him and moove on taking ownership of debt in your name only.

Andyjflet

It took me until my 50's to realise how money really works I'm ashamed to say, but better late than never. I always had the cars on HP, the nice house, holiday on a CC etc and realised in reality I had nothing. The banks owned it all.

Take a look at your life, if he refuses to change then walk away and get yourself straight, understand money, pay off your debts and live a debt free life, it really is an enlightening experience, paying cash for the things you want, or walking away when you realise it will eat into your savings too much!

Good Luck

kimwp

It might be worth giving the 20k back to your mother if you think you will be coerced into handing it over to your partner's father.

How come the money your parents gave you didn't cover all your debt, but you have 20k from your mum?

Flugelhorn

kimwp said:

It might be worth giving the 20k back to your mother if you think you will be coerced into handing it over to your partner's father.

How come the money your parents gave you didn't cover all your debt, but you have 20k from your mum?

OP mentions "fixed savings" - I wonder if it was a fixed term and not accessible at the time?