Money Moral Dilemma: Should I insist my friend pays me back, even though they’re struggling?

keithyno.1

As long as it was made CLEAR that this money was in the form of loans, rather than gifts, then of course you're within your rights to ask for it to be repaid. The trouble is, because you didn't stipulate a structured repayment schedule at the time you lent it you really may struggle to get anything back from your friend. If they say to you, "I'm sorry but I really can't afford to repay you anything now or in the near future," what are you going to do? Of course you could pursue them through the courts but if they simply don't have the money to make any repayments then that probably won't do any good either. I'm afraid this could turn out to be a very expensive lesson to you, together with a possible ruined friendship. It doesn't sound good at all.

Namelesselder

You lent the money knowing your friend was in trouble and I suspect that you weren't too bothered about whether she could repay at the time. You need to have a conversation now about whether she can pay you back, probably a little every month, or at some well defined and realistic point in future - or else you decide you are going to leave this as a gift. You may be be able to treat it as charity donations and at least get some tax back, but you'd need proper financial advice on how to do that, if it's possible. You need to formalise whatever is decided between you, Your friend may not feel happy at owing you this money either. so you're doing both of you a favour if you can resolved it without conflicts. Ignore the judgemental advice you're being given. I feel from your email you know she's honest.

Shell1989

Now that you’re retired, is there a way your friend can pay you back outside of monetarily? For example, since she doesn’t work, could she clean your house? Most cleaners charge £15ph. If she did 6 hours a week as 2 x 3 hour stints that’s £90 worth of cleaning a week. It would still take 7 years to “pay back” the £4000 but it’s a start. There could be other jobs you don’t particularly like doing or want to pull back on that she could help with? Gardening, food shopping? I think you should have a conversation with her about the debt but get creative with the solutions so that you can be sure you made it very possible for her to redeem herself. If she refuses, she wasn’t your friend, she just used you for your generosity - but at least you now know :)

Jodo

https://forums.moneysavingexpert.com/discussion/comment/82005284#Comment_82005284

This is a really interesting suggestion.

ripongrammargirl

shell1989 summed this situation up perfectly. Before money was invented people paid each via trading goods or services, such as gardening/ food/ cleaning etc. The loan should have been stipulated as this with a formal agreement: I always watched Judge Rinder who made it very clear that if nothing was written down and signed for in a contract then it was a gift and not a loan. The ex should be paying for their offspring (see many other Judge Rinder cases) and this is a legal requirement. You need to sit down and have a conversation with her about income and outgoings. If she is smoking, drinking, paying for extra TV channels, holidays, days out and general squandering then she can afford to pay you back as she needs to do the right thing, which is not indulging with luxuries whilst she owes money. Years ago I was so skint I had one cuppa soup every other day and tap water for 3 months because I had a mortgage so needed to keep my flat: everything else I had including an old second hand car had to be sold to make ends meet.
Never lend and never borrow unless it’s all legal with contracts. The ex has a lot to answer for so take your friend (if she is genuine and not a sponger) down this route.
If you are a “giver” then be aware of your limits because “takers” don’t have any.

Teddy08

hi

I am in a similar situation.

I helped my friend paid credit card debt of £3.000 and other various debt

The friend is working full time and not once offered to pay me back any amount

I too have retired and need money to pay for various expenses

I agree that you should ask for it back

Cantandrex

I would hope that your friend has done everything to ensure their ex pays maintenance for their child! If not, it is time that they got it sorted, especially as they know that they had a loan from you. Having had a similar issue to this myself, I think I have a harder approach than others - a loan is a loan, and they should do everything they can to pay it back!

You should feel able to approach them and indeed have the right to ask for some form of repayment, but may have to accept small amounts, if any!

Your situation sounds a lot like mine - the original loan seems to have opened up the possibilities of more - I 'gave in' to several requests and then had to be really firm and close the whole thing down (knowing that it was very unlikely I would see the money again)

My parents advised me 'never a lender nor a borrower be' - with hindsight and to my detriment, this proved to be wise advice!

kimwp

https://forums.moneysavingexpert.com/discussion/comment/82005223#Comment_82005223

https://forums.moneysavingexpert.com/discussion/comment/82005284#Comment_82005284

This sounds like a good solution. I suspect there would be tax complications as effectively it turns the loan into paying for labour, but hopefully not.

Jemma01

I would check on their situation again since your situation changed. It's been 4years and this child is at school now, there's no reason for this person to remain without a job, if so, they need to get one to pay you. And if they're without a job when kid is at school, then they must have another income (universal credit and child benefit, etc) and not be struggling.

You have the right to ask, tell her being retired, you too are now falling on hard time and see if she's grateful.

headsm

Never lend money to friends or family unless you are ok with not getting it back.