Lending money to friends & family

chalkie99

I would suggest making sure your repayments have some sort of paper trail - either a signed and dated receipt for each one or pay by cheque just to prove you have paid it all and fend off any disagreements.

Rat_lover

Yes I will Thanks for the advice.

fozmcfc

Do come back and give us an update on this. As Chalkie says, definately I would get something written down.

anil007

Keep business business. Even if you are lending money to friends and family, while you are talking about it, write it down. Discuss the collateral, security, and interest rate on a promissory note. Why? Because something unexpected could happen.

John_Pierpoint

Like the borrower dying:eek:

LovelyLeeds

Rat_lover wrote: »

I have offered to pay her £100 a week but she has refused.

All you need to do is this:
Write down that you have already paid £400 (date of payment if possible), then write down 6 x £100 a week and date them - each time you have given her £100 sign it - give her a copy. There is absolutely zero she can do in six weeks re Court Action, and if she did take it to Court, your offer of £100 a week would absolutely be accepted by any Judge in the land - in fact they would be delighted!
Really, you have nothing to worry about. Just pay her what you have now agreed, ie £100 for the next six weeks - and you will be done and dusted.
Let us know in six weeks time wont you?

Debt_Robot

andy.m wrote: »

The point throughtout all 600 odd posts on this thread is pretty clear:

a) you have no chance at all if you have no paperwork and your mate defaults
b) even if you have paperwork and your mate defaults, lets say you win the small claims, how exactly are they going to pay you if they still have no money.

The very best thing you could do to anyone asking to borrow money would be to direct them here and hopefully they will have their lightbulb moment and make wholesale lifestyle changes.

+1 - and it is these wholesale changes you mention that will enable them to pay for themselves.

minamoo_2

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.

This is something which has happened to me as well and I couldn't find a solution how to get my money back. Debt Robot is right, even if you find proof you have loaned the money, you will need to ensure a solicitor that they have the money to repay you or else they won't be interested in taking your case.

chubsta

Back in post 621 i mentioned i had lent £100 to a friend who has a gambling problem, well, after not seeing him at work for ages (we work separate shifts so this is nothing unusual) I finally bumped into him, he mentioned about the money and went straight off to a cash-point to get it...

I am sure that if i hadn't seen him then it would have waited but there were no excuses from him, he just apologised for it taking so long and i could see he still felt bad about it.

I guess that despite all his problems with money at least he has still got a sense of responsibility towards his friends that is lacking in a lot of people i read about here, at least in this case there was a happy ending...

swindled

This thread is very useful, but even with it, people still will continue to lend money to relatives and friends even if you have supposed security, or even trust. I was fairly sure that I couldn't count on mere trust, but I thought I had security.

Back in summer of 2008 my mother was telling me sob stories about my brother, what a terrible situation he was in and he was liable to lose his jewellery to the pawn shop because he had temporarily put it in pawn with buy-back, but was struggling to even make the interest payments.

The value of this jewellery was in the order of several thousand pounds, and the money he owed the pawn shop to retrieve it was £1700. It was clear that he wanted me to lend him the cash, but didn't have the nerve to ask in person, due to the difficulties he has had repaying other family members loans, so he went through my mother. None of the other half dozen members of the famiy, including his father would have anything to do with it.

So I told him I would lend him the money if he gave me the jewellery as security, so it could be sold to recover the loan if required, and as at the time I was temporarily renting up north in a fairly insalubrious area prone to burglaries, I didn't want to have it nicked, so I told him he was to give it to my mother (who he lived with) and she would keep it safe at her house in a nice area. He agreed to do so and I handed over the cash.

Fast forwards a few months later and I was home for a visit, I asked about the jewellery. My mother told me that he hadn't given it to her yet. A bit angry, I confronted him about it and he told me it was in his room (which was a mess) and he'd find it and get it for me. Of course, it wasn't, and after repeated promises over the course of my visit, it came to the day before I was leaving back up north and I told him to go and get it 'right now'. He then admitted that he didn't have it, it was at his girlfriend's house, she had 'demanded she keep it safe'.

Knowing this to be probably !!!!!!!!, the day afterwards I found a pawn shop receipt that indicated that the jewellery had been re-pawned three days after (Friday-Monday) it had been unpawned. Not being a lot I could do, to keep the peace (and the repayments), I didn't let on that I knew and was accepting sporadic payments of £50 here, £50 there over the course of four months, in spite of him earning a significant amount on the black, cash in hand, and having no liabilities - my mum didn't even charge him rent.

It all came to a head when him and my mum having an argument about him using her landline to ring mobile phones, and running up massive bills each month, he even denied using the phone. When confronted with itemised bills, he admitted that the calls were only for a few seconds, or they didn't pick up, in spite of the provider charging per minute rate even when it goes to answerphone. So he left the house for his mates place, having only paid me £420. I knew that in spite of promises to keep paying, it would be a case of 'out of sight, out of mind'

And so it was. I haven't seen or heard of him since. I hear he's now working and living at my sister's as his mate had had enough and kicked him out. This week I asked her if he had any intention to start paying me back, she laughed and replied, well, he's got to pay me back first, it turns out that even though she knew about the money he owed me, she had lent him £500 when he moved in with her and as he was in the process of repaying her, she was insisting that she get paid back before I did. That's family solidarity for you.

So the basic rule of thumb will be - if they have financially screwed their life up, it's up to them to get the bank or similar to bail them out. If they won't, then tough.

If they choose not to repay you, there isn't a damn thing you can do, short of that associated with the behaviour of types of moneylenders of last resort when the banks won't have anything to do with them.

Because you won't be able to send in the bailiffs should they fail to repay you, no matter what sort of 'agreement' you have, it won't be worth the paper it's written on. If they can't get a bank to lend them money, its likely that bailiffs have been sniffing around already and if they have no interest in paying them, what makes you think they will have any interest in paying you?