Private loan friend to friend to pay for a lease extension

edited 8 January 2020 at 11:41AM in Loans
82 replies 4.2K views
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  • If I don't do it, she will end up losing out badly. I don't want to see her losing out.


    No don't do it! YOU will lose out.


    A contract is just a piece of paper.


    If she goes bankrupt, I assume she will be able to include this "personal loan" into it so you won't get a dime back.


    If I was you, don't give her the money, that's your money you worked hard for. Should be going towards your retirement so you can retire early.
  • Also you already gave them 5,000 2 years ago and they haven't paid you back.


    What makes you think they're going to pay you back 80 grand?!


    They're taking advantage of you mate.
  • chucknorrischucknorris Forumite
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    Also you already gave them 5,000 2 years ago and they haven't paid you back.


    What makes you think they're going to pay you back 80 grand?!


    They're taking advantage of you mate.

    The £5k was unsecured, this (and the £5k included) would be a secured loan.
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  • chucknorrischucknorris Forumite
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    No don't do it! YOU will lose out.


    A contract is just a piece of paper.


    If she goes bankrupt, I assume she will be able to include this "personal loan" into it so you won't get a dime back.


    If I was you, don't give her the money, that's your money you worked hard for. Should be going towards your retirement so you can retire early.

    Thanks, but the loan would be secured against the property.
    Chuck Norris can kill two stones with one bird
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  • zx81zx81 Forumite
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    At the end of the day, it has to be your decision.

    If you go into it knowing that you will probably lose the money, and definitely the friendship however it works out, then at least you'll be prepared.
  • edited 8 January 2020 at 1:07PM
    chucknorrischucknorris Forumite
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    edited 8 January 2020 at 1:07PM
    zx81 wrote: »
    At the end of the day, it has to be your decision.

    If you go into it knowing that you will probably lose the money, and definitely the friendship however it works out, then at least you'll be prepared.

    I hear what you are saying, but I can't see how I would probably lose the money if the loan is secured on the property. But if so, I would like to understand how I could lose, I am trying to be open minded to explore what could go wrong.

    3 things are important to me:

    1. Help my friend

    and if things don't go as planned:

    Try and ensure that I have protected myself by:

    2. Securing the loan on the property
    3. Putting myself in the position where I can (if absolutely necessary) enforce the sale of the property.
    Chuck Norris can kill two stones with one bird
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  • zx81zx81 Forumite
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    For the reasons given above. Not selling, bankruptcy, loss of value.

    But do consider the friendship, as that will be gone either way. Either when they don't repay you, or when they realise you want £100k from them in a few years from the sale of the THEIR house, and they can no longer afford the things they planned to buy.
  • StenwoldStenwold Forumite
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    Whilst it's admirable that you want to help your friend, she is in this situation by not helping herself.


    She let the lease go down to 40 years, you shouldn't feel responsible for this.


    She changed her mind about moving house two years ago and then kept your money - that is not something a friend does.


    If you really want to help, buy the flat off them with an 80k discount to cover the lease extension. It's then yours to do as you please.
  • garth549garth549 Forumite
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    How long have they owned the flat? I'm surprised their solicitor didn't advise them to insist that the lease was extended before they bought it (unless they've had it a seriously long time (20+ years) or the price at the time reflected this).
    Stenwold wrote: »
    If you really want to help, buy the flat off them with an 80k discount to cover the lease extension. It's then yours to do as you please.

    This is by far the best advice here. Purchase it yourself, discounted, with the lease extension being part of the contract. You're then only vulnerable to a drop in market value.
  • Money_makerMoney_maker Forumite
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    Why do you feel you need to sort it out? Are they more than friends, ie family? Best you can do for them is step back and let things play out. May encourage them to find employment and be accountable for their own decisions. Can't see a single reason why you would do this (lets face it, they wont be friends for long once they have your 80K).
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