Lending money to friends & family

clintus2

well, no money from them, i sent a text saying i need 3k by 1pm today. doubt i will get it.
Just applied for 5 loans to try and get some kind of relief, they all said no. I can't beleive this, 6 months ago i could of got 25k no problem, now, because im overdrawn and have used CC my credit rating must be rubbish.
as for throwing everything at mortgage, its difficult as we have about 300 between us. mortgage is 1400. going to go up in the loft saturday and stick as much as i can on ebay.
my god, to get in this situation because you helped someone out. just makes me depressed, and thats with 20mg of prozac.
thanks for all your help peeps, ill keep you informed.

quickstepqueen

All the best Clintus2..do keep us informed. I know I've found this thread helpful - it helps me vent my frustrations (that my OH is fed up of hearing )

I wish you well and hope Ebay buyers are very generous. As AMILLIONDOLARS has said just concentrate on keeping a roof over your head. Difficult I know but all the best.

hemel10

Not sure if I'm in the right place but could anyone send me or advise me where I could get a form of words for a loan agreement between mother and daughter - all the ones on the net incurr a fee to view

mousetrap_3

Am in a similar situation and wondered without a written contract to repay a loan how would a verbal contract be proven in court.
If an independent witness could vouch for the loan then I could see that this could be proven but if the witness is a family member of the claimant would this not be viewed as bias in the small claims court ?

MABLE

Speaking from experience of loaning money to friends is NEVER, EVER,EVER loan money. If banks wont consider them for a loan there has to be something very wrong. I loaned an ex friend of mine 600 pounds a few years ago. They paid it back but the cheque bounced. I was very upset and confronted this friend who turned very nasty. I evenually got the money but destroyed a friendship in the process.

roswell

A friend who doesnt pay back ... isnt a friend.

clintus2

Still no money, but have been told house is going to exchange soon. sold my car for half its value to cover mortgage. thank god for my mum and my fiances current mother in law and friends who have kept us fed. Bank has been terrible and completely non understanding. funny, 6 months ago i could get a 25k loan with no problem. now i cant get anything.
waiting to see if we get money when their exchange goes through before we sue.
One question, I went to a DCA and they have not been great, if i get a cheque direct from Fiance's sister (YAH RIGHT) do I have to pay the DCA as they themselves have not recovered the money?

bel2310

Hope this is the right place to ask this. I am considering lending a friend £10,000. We are using a written agreement and the intention is she will pay back over 3 years, with 5% interest. However I am not quite sure how to calculate the total amount, I originally thought it was just 5% on 10,000,i.e. 500 but she has pointed out to me that loan companies don't add the interest in just one lump like that. Can anyone explain to me how I should work it out,
Many thanks

Emmzi

bel2310 wrote:

Hope this is the right place to ask this. I am considering lending a friend £10,000. We are using a written agreement and the intention is she will pay back over 3 years, with 5% interest. However I am not quite sure how to calculate the total amount, I originally thought it was just 5% on 10,000,i.e. 500 but she has pointed out to me that loan companies don't add the interest in just one lump like that. Can anyone explain to me how I should work it out,
Many thanks

Loan companies sometimes DO add it all upfront like that. It depends if 5% is flat rate or APR...

A 'flat rate' of 5% over 3 years means she pays you back £11,500 in total.

This calculator may help

http://www.fsa.gov.uk/consumer/04_CREDIT_DEBT/loan_calculator.html

If you use 'build repayment schedule' it'll give you a fully detailed breakdown.

It would also be useful for you to print this off in case she wants to make an early repayment - you could attached it to the loan agreement.

Btw I always remember 'when you're lending money to friends, at the outrset decide which you need more'...

bel2310

Thanks Emmzi, thats really helpful. I am aware that it could be a dodgy one which is why we both want to do it right, and in all fairness it was her who pointed out my calculations were too low.
Thanks again