Lending money to friends & family

brickhouse

What a gem you are! Thank you!

Does this document have more weight if witness signed by a commissioner of oaths or something?

Best Regards,

Brickhouse

missfendiuk wrote: »

Well, after drafting this loan template (yes, i am in law school) i decided to inform the person that put my hubby and i in the uncomfortable postion of asking for a £1.500 loan to come and pick up the cheque.

I also mentioned that I have a loan agreement for them to sign!!!

This was two days ago, since then they have not phoned or contacted us!!! so this can work to put someone off borrowing money from you!!

brickhouse

Lending to friends and family is one of life's greatest challenges. You discover not just who your real friends are, but also sometimes that you can rely on friends far more than family.

There is no sweeter feeling than repaying a loan to a friend or family. Especially when you can repay it within the agreed time or earlier, and without being reminded. There is nothing more awesome than a friend that lends you money and states, I will never remind you. I will trust you to pay it and if you never, well, so be it.

Reading all the horror stories of lenders and borrowers alike has filled me with horror at the things that can go wrong. I've been taken for very expensive rides - I once dated a compulsive gambler who made me borrow from every orifice amounts that very quickly totalled over £15,000. This was in the mid 90's. I came to terms with the fact that he would never pay me back and just moved on rather than be ruled by it. It taught me that lending to a boy-friend or husband is pretty much always doomed (yes, I had also lent a lot of money to ex-hubby, but not as much as £15,000).

The result is a cynic in me that is tempered by the generosity and kindness of my own friends when I have recently been in trouble. Their trust and respect is something that money can't buy and a bad debt can destroy. I shall be reporting here when I have paid them back (once I've sold my house).

Will I ever lend any one money again? To any of the friends that have recently helped me, yes, without a flicker of an eye-lid, I'd sell my possessions to help them out if they were in need. But on a general rule, I'd only lend to others as much as I was willing to kiss good-bye in the highly likely scenario that they would not pay back. And of course, once they've muddied the waters in this way, they'd never have the temerity to try and borrow from me again, would they?

I lent one friend some money a few years ago. He tried to repay the loan by transferring his Sky subscription to my address. He'd never actually said, would you take this in lieu of me paying you back. Indeed, when he first suggested to me that Sky was wonderful and I should get it, I'd said then that it was low on my list of priorities. I actually thought when he did transfer it that I was doing him a favour. He had no fixed address at which he could install it and whether he'd moved it to my address or not, was locked into the one year contract and therefore had to pay it every month. And it was this logic that swayed me into agreeing to having a dish installed at my home. So imagine my surprise when I asked him when he might start repaying me, and he said, but I gave you my sky package as part payment. (there was maybe like five months left on it at the time). He said he thought it would help. Help how? I didn't need Sky to survive and had never had it prior and never had it since.

Another friend, female this time, has never offered me a penny towards the money I lent her or paid out on her behalf to get her started in running her own business. But she did ask me for my address as she wanted to order me the complete series of the BBC's recent (and splendid) Bleak House production. She said she'd noted that I liked it so much. I reminded her that I'd watched every episode already. I could tell she was put out as in her mind, that would have cleared her obligations and indebtedness to me. Frankly, I'd have rather she posted a cheque for the value of the series of Bleak House instead!

But that was when I noticed a pattern, that some people will, instead of saying, hey, how much exactly do I owe you and here is how I intend to repay (or can't repay), they'll try and fob you off with a token gesture of a significantly lesser amount.

Perhaps I should be grateful that they offered any thing at all.

Jane

loveandlight wrote: »

As this is a very long thread I haven't had time to read it all. Just wanted to say that maybe the secret of getting friends not to borrow from you is to do what one of my friends did. She lent us money when we were left penniless after being defrauded and losing all our life savings and she then took advantage of us by lying to us, demanding to know our whereabouts at all times and emotionally blackmailing us etc. Then when we did pay her back in full immediately we got our own money back, she tried to claim that we owed more than what we did. Fortunately I had kept a record of everything but she hadn't. Even now several years later she still offers to lend us money, but no fear, I would never borrow money off her or anyone else again, apart from the bank.

I, on the other hand, lent another friend a series of small amounts making up a total of £750 and I said she could pay me back when she got back on her feet. ( She had been made redundant and ended up losing her house etc). I never got repaid. I am a great believer in don't lend what you can't afford to lose. We have lost touch now but I don't regret lending her the money, as I had already written it off in my own mind anyway.

bigEm

pennymakespounds wrote: »

not sure if this is right board..

member of our family "lent" couple of £thousand to a "friend" to fund something....
which didn't happen .. and guy has made himself completely uncontactable . Apparantely he's done similar with couple of other people

Whilst probably classed as my own stupid fault for just handing over cash .. last thing we expected was this .. from a supposedly "best friend" .
What legal actions can i take .. or "legal threats" can i make to try and get him to realise i'm seriously wanting my money back.

There may be help with your "friends" issues, there is a possibility that a service could be offered that would ensure the money was returned no questions asked, as long as you have some general details about the loan holder the loan could be collected for a small percentage fee. There are many debt collection "services" if you know where to look.

sexki11en

Turning_into_scrooge wrote: »

I would say to anyone who is considering lending any money to anyone who is not a family member DO NOT DO IT unless you can afford to lose it permanently.

I wouldn't even do it for a family member after recent experience.

A year and a half ago, my OH's dad's business was struggling financially and he asked for a loan for 2 weeks. My OH lent him £2000 on his credit card (all he could manage as that took his card to the £6000 limit) on the understanding that in a couple of weeks he would have it back.

You can guess what's coming next can't you? We haven't seen a penny back despite repeated requests. All we get is empty promises. A month ago our car was written off by a truck :eek: and the ins only paid out £750 so we told him we were desperate for something, anything back to help get a better car. 4 weeks later......nothing :mad: I should explain, his dad works in the far east so we can't knock on the door or contact him easily.

For a year and a half we have been paying the interest on the repayments - £150 a month down the drain for us.

Don't lend anyone money unless you have a bottomless pit or a money tree in your back garden (and if you do, can we have a cutting please :rotfl: )

keikoyule

Xbigman wrote: »

Have you got anything in writing or even a receipt, or maybe witnesses. If not you are unlikely to get your money back if he doesn't want to pay.
Regards



X

No i cant do that.

magoogy

god - this brings me back - my hubby lent an ex friend £100, which i know isnt much, to go to a wedding in ireland - she gave us it back in two cheques for £50 which both bounced...i tore one up in anger after trying 3 times to cash it and told her i wanted cash which was always gonna come....we fell out and one day i found the other £50 cheque and tried cashing it - it worked and i got £50 at least out of her - just hope it caused her major hardship with being out of pocket.....

MABLE

magoogy wrote: »

god - this brings me back - my hubby lent an ex friend £100, which i know isnt much, to go to a wedding in ireland - she gave us it back in two cheques for £50 which both bounced...i tore one up in anger after trying 3 times to cash it and told her i wanted cash which was always gonna come....we fell out and one day i found the other £50 cheque and tried cashing it - it worked and i got £50 at least out of her - just hope it caused her major hardship with being out of pocket.....

I Loaned a friend £600 many years ago but took out an overdraft to support this amount. When it came for the money to be paid back I was given a cheque for the amount but the cheque bounced. I confronted my friend who said the bank must have made a mistake. Evenually after much pestering I got my money back but lost a friend in the process. NEVER, EVER AGAIN

Little_Miss_Muffet_2

My cousin who has problems with living beyond his means and has been in trouble with the law has asked me to take out a van lease on his behalf because he cant get credit becoz of previous illegal finance schemes. Im worried because I initially had quite bad credit and have worked myself to a position where I have quite good credit and have been able to get loans, credit cards etc. Now that my credit is good I dont really want to mess it up.
On the other hand I feel quite sorry for him because he has been unemployed for the past year due to the criminal record and I want to help him start his own business coz employers will not touch him with a barge pole. But he has a record for being careless with money. I suggested to him that rather than get a loan for a brand new van why doesnt he buy a cheap second hand one for under a 1000 and if the business has the really good returns he is talking about then he will be able to upgrade in less than a year. But he says buying a second hand car will be more costly in the long term. Is this true? He wants me to take out a lease for 4 yrs. I said I was not comfortable with him owing me money for that length of time and would only consider it if its less than two years. he says that I should take it out for fours years and then he will make over payments and pay it off in two years like i want. I am quite worried coz I dont really like messing up my credit coz if it was an out right loan from money that I had it would be okay but taking out a lease if he doesnt pay I would still be obliged to pay it back. Also he was saying that even if he failed to pay it wouldnt result in me having a bad credit rating as the company would just repossess the van and cancel the debt. Is this true? My cousin is such a sweet talker I dont really know whats what. Would this not also affect my ability to get other loans? Is teher a way I can help him without havimng to put the loan completely in my name or should I just say NO flat out? Im not too keen about lending large sums of money to people coz I cant afford it anyway but I feel guilty about not helping him out.

maz1964

Hi little miss muffet

pls pls do not take out the lease just because he says its okay,,,,crikey, you will be liable if he defaults and of course your credit rating will be showing any missed payments and will affect you if your are the person attributed to the lease,,,,,

there surely must be better ways to help him, what about any business start up programmes in your area,,,

im sure other business people and legal eagles will be along soon to offer better or more concise advice, but please dont let him bulldoze you into signing anything without proper consideration okay ,,,,

will subscribe to this post to see what you decide to do

ciao for now MAZ

nobblyned

LMM, in your words, he's living beyond his means, he's bad with money and has a criminal record. Heed the warning signs.

Don't borrow money for him, not even over 2 years. Your idea that he buys cheap and works his way up is the right one.