Lending money to friends & family

EmeraldEncrusted

I know this may be a little late for some, but I would urge everyone to never mix money and friendship.

If you do lend, never lend an amount greater than you'd be sorry to lose. When you lend to a friend you must prepare yourself to either never see the money again, never see the friend again or both.

People are resourceful creatures and will do what they need to do to survive; that may be by ruining a friendship by refusing to pay back money or it could be by stepping up a gear and trying to save or supplement their own income by working for it, so they wouldn't need to ask for it in the first place.

I don't know about others here, but i'm always astounded by the stories I hear from people who have "lent" to "friends" who were desperate for a loan, never to see the money (or friend) again. Often if you look closely at those "friends" you will find they are usually the ones living more extravagantly, outside their means. By lending them money they will just continue with this habit instead of correcting it. I would argue that a good friend would first point out these failings (diplomatically) and offer some good advice to help them get to grips with their finances.

Anyone can live within their means if they want to, but you have to ask do they really want to?

A man who earns £1 but spends only 50p is rich, while he who earns £1,000,000 but spends £2,000,000 is poor.

GeorgeV_2

I don't think that it'a a good idea to lend money to 'close' people, especially to friends and relatives as it can ruin your relationships. I always try to avoid it. I prefer to take loans rather than apply to my family.

wisdomofhinesight

I am in the process of small claims court, I lent a friend nearly £4,000 which was either as a loan or as an advance of work that he could possible do in the future (he is a builder) he was in dire straights and even made me think that he could commit suicide after 16mths of chasing him to re-pay the debt as my partner said that he wasn't happy with this guy's standard of work and so he wasn't able to work the debt off. I contacted a specialist debt collectors he said that he had no record of this debt. I have a signed agreement and a receipt for the bank transfer. Now that I have issued small claims proceedings he say's that he has replaced 3 ceilings in my house! I will get a judgement, but will I get my money back? I will pursue him through the courts and will put a charge on his property so that hopefully in years to come I will recover my money along with 8% interest under section 69 of the County Courts Act 1984.
Good luck

maz1964

hiya all

let my story be a warning to others, helping a friend who was being close to eviction from their house, i paid thier mortgage arrears off, and now a year later still no money back, they are getting divorced and ive ended up with a ccj due to the credit card not being paid off!!!! and the husband is probably going to go bankrupt after the divorce - does not care ive put my neck on the line for them:mad:

worst part i didnt tell my other half and they will go crazy if i ever get a charging order on my house

so pls pls pls do not lend or pay off your friends debts unless you have some collateral as proof of repayment, and better still set somehting up with a signed document with a solicitor and get them to pay that bill

mind you id rather pay for their shopping and petrol then ever pay for anyone elses debts

i feel ashamed and why should i feel this way when all i did was save their house and keep their kids away from being evicted -

i feel very upset over this and it has damaged my friendship as ive found out they befriended me and didnt really tell me the truth over their full financial problems,

i really feel so cross with myself, but i have to pick myself up and try and get a set aside on the ccj and try to defend it as best as i can if i lose try and get an amount i can pay back so i dont end up with a charging order

keep happy maz

gordikin

2 letters N & O!

harryhound

main!!!!!! - I think the ghost of Mary Whitehouse has taken over the forum

mjm3346

Mozette wrote: »

Why is !!!!!!! (l e n d i n g) being !!!! out? is it now a swear word?

Probably because someone kept making unsubstantiated allegations about a company that has that as part of their name.




http://forums.moneysavingexpert.com/showthread.php?t=2895588

andy.m_2

I lent a friend £10 a few years ago.
I no longer have that friend or my £10 back.

Not as much money, or as harrowing a story as others, but it sucks all the same.#


Can I just say that my perspective on pretty much every post on this thread is thus:

If it is not spelled out in black and white then confusion can arrise and that's when both parties feel hard done by.

callistris

Despite reading this whole thread I lent a good (at least I thought she was) friend some money.
We have been friends for a very long time and in the past I've loaned her money which she always paid back, these were only small amounts which is probably why I got paid.

The sum of money I lent my friend was £600 towards a holiday we went on this year. I offered her the loan as it was quite short notice and she promised as soon as we got back she would pay me back, monthly.

Upon our return my friend did all she could to avoid me, would never turn up at mine when she said she would, or if was going round there she would make up an excuse saying she was going out. She rarely replied to texts and never answered any calls from me.
On the odd time I did manage to get a reply from her she always had a different excuse as to why she couldn't pay:( or if I was lucky I would get a promise to pay me next week on payday, but the money never came!

Now over 3 months down the line she has called an end to our friendship, just because I said in a text to her that I was starting to feel she had no intention of paying me back!

I've lost now someone who was a long time friend who I've had some great times over the years with, which is a shame as over all this I feel like I've been taken for a right mug, which I probably have!

I have been left with one promise to pay me next friday, not sure how much it is, maybe just the monthly payment she offered me of £60 or it might even be the full amount of £600. Tbh after what I've had to listen to over the last few months its probably yet again another false promise:mad:

One thing that has come out of this though, I won't be lending anyone no matter how good a friend they are any money ever again;)

only.partly.my.debt

Hello,

first post (on a forum, ever) and I'm looking for advice. I've read through all the posts on this thread and, while not feeling quite so uniquely naive, I'm not feeling optimistic either!

My partner, let's call them P, asked me to take out a loan for their son, let's call him S. S was at that point in his early twenties, full-time, well-paid job, and the loan was for a commute-to-work vehicle as he had poor credit rating. I had my doubts but was in love (this is where the naivety comes in - the relationship was quite new).

So £8,000 bank loan in my name to be repayed over 5 years, much hugs and delight all round. He can get to work on time and keep his job and not be a big finalcial drain on P.

2 years later the marriage is over (and I've gone from being about £2,000 in credit to about £2,500 in debt, not counting this loan, but I'm an adult and will deal with it). £3,000 of the loan has been paid (at least 50% by me - see below).

S was always...temperamental...in repaying the loan, and P constantly made excuses (he's had such a bad month; or he deserves a break; or his friend are all going to XXX and he can't afford to; or £175 per month is a lot so don't take it all on the rare occasions he pays and give him £25 or so back). Always the payment needed many reminders and was often late. There was talk of setting up standing orders. Oh, he would. Or thought he had, but he bank hadn't made it happen. Or he didn't have my details. Or he was abducted by aliens (I exaggerate, but you get the drift).

I hold my hand up to some doormat tendencies, but the point is...

Since the breakup, S has refused to answer texts or pay any money. P insisted he said he would set up an SO, definitely... before breaking off communications. I can't afford to pay back the remaining £5,000 of the debt, £175 a month is not an additional struggle I need right now, and more importantly, I don't want to, da""it! It was his loan and he agreed to pay it back!

It was all done verbally, nothing inwriting. The only witness to this was P, who, from past experience, will say black is white to protect her darling S. I think his father also knew about it, but not 100% about how much he knew. Certainly P discouraged me from telling anyone (...what an idiot I'd been?).

So, advice please?

Citizens Advice have said I'm legally responsible for the loan, which I knew but hoped otherwise. Do you think I have a case that would justify paying for legal advice (or suggestions for free legal advice?)? How do I get him to pay? I'd rather he give me £5000 than set up an SO, as he's been so unreliable, but at this point I'd take anything.

I've read through EVERY post on this thread (thanks to a friend who sent me the link) and I have a couple of additional points which may be relevant:

a) I'd like to keep the chance of a friendship with P in the future if at all possible, so suggestions to get S kneecapped are, while briefly gratifying, unlikely to be followed.

b) S can, actually, pay it. He is astonishingly spendthrift, however he earns £4K more than me per year. He had a really poor credit rating (hence my taking out the loan). He now has a much better credit rating (while mine - and to an extent P's - has gone down the tubes. Connection? There is one).

c) While I want to stay on good terms with P, I don't care so much about him. The most stand-up, toe to toe argument I had with him in the 2+ years of sharing a house was when he came in p***ed off at being permanantly broke due to indulging his expensive tastes and yelled at P and I that we should get better paid jobs in order to be able to give him more money so he could do the things he wanted to - despite the fact he was earning more than either of us and living in the parental home rent-free!

So please, excuse the long story and let me know my legal/wise/best-chance options. All suggestions gratefully received.



Thanks.