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Private loan friend to friend to pay for a lease extension

edited 8 January at 11:41AM in Loans
82 replies 4.2K views
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  • JimmyTheWigJimmyTheWig Forumite
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    Regarding the inheritance, you are way off the mark, the situation is that I (we) can't spend what we have (without just wasting it), and we have no family to leave it to.
    In which case, would it be a ridiculous idea to give the £80k as a gift?
  • The way I view it is that if things went that way (which I don't think that they would), it would be them that loses a friend, I lose someone that I 'thought' was a friend (but as I said, I don't think that is the situation).

    you are a nice kind person doing this, and I really hope it all works out well, because helping people doesn't always end in disaster. Fair play to you :beer:
    excuse the username, what I wanted wasn't allowed. It's just a song title...
  • edited 10 January at 5:02PM
    phillwphillw Forumite
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    edited 10 January at 5:02PM
    Gaz83 wrote: »
    What if the property doesn't sell for its expected value, and after the first charge is paid there isn't enough to pay you?

    Surely the transaction can't go ahead unless both charges are fulfilled (if written properly).

    Doesn't the mortgage lender have to agree to a second charge though?
    Regarding the inheritance, you are way off the mark, the situation is that I (we) can't spend what we have (without just wasting it), and we have no family to leave it to.

    I really can't see why you are wasting money on solicitors then. Just write your own loan agreement, it doesn't sound like would ever take them to court anyway but it leaves the door open. If they stiff you then remove them from your will and move on.
  • MadgeTMadgeT Forumite
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    To me it would depend on how much you value your friendship. Lending money is ok if your prepared for possibly losing it and not getting it back. Even with the best will in the world, if things go per shaped and she cannot pay it back - that would put nasty blip on your friendship - either by you because your angry about not getting your money back or from her as she is embarrassed about not paying you back. Yes, by all means put contracts in place as it may prove something of a safeguard, but if the contracts get broken well ?????? :(
  • -taff-taff Forumite
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    Just one thing, if you have left part of your estate to a charity and you have a friend or family member as an executor, make sure you've left them a specified amount of money, not a percentage, because if you leave them a percentage, the excecutor will curse you for all the extra work and stress that will cause.
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  • Don't lend money to a friend.....my thread under LOANS.

    There are some good comments on there that I am grateful for.

    Under your agreement add 27 pages of small print to cover all situations as this would be an unregulated loan. Santander's Terms and Conditions could just be copy and pasted.
  • chucknorrischucknorris Forumite
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    phillw wrote: »
    Surely the transaction can't go ahead unless both charges are fulfilled (if written properly).

    Doesn't the mortgage lender have to agree to a second charge though?



    I really can't see why you are wasting money on solicitors then. Just write your own loan agreement, it doesn't sound like would ever take them to court anyway but it leaves the door open. If they stiff you then remove them from your will and move on.

    First of all I have found out that there is no mortgage lender, they paid off the mortgage a few years ago (just found out today). I also brought that up earlier about the second charge, so why ask! But now that I will have the first charge, this looks quite straight forward.

    Secondly, you don't seem to understand that if someone acted totally different to the way that you thought that you knew their character, and thought that you understood them, then you would change your attitude and take them to court. Life is a fluid situation!

    I am not wasting money on solicitors, it is a legitimate cost that they will have to pay, it is far less costly than any other alternative that they have.
    Chuck Norris can kill two stones with one bird
    The only time Chuck Norris was wrong was when he thought he had made a mistake
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  • glennstarglennstar Forumite
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    I am not wasting money on solicitors, it is a legitimate cost that they will have to pay, it is far less costly than any other alternative that they have.

    Make sure you use a solicitor with experience in this area. They aren't all the same and they don't all know their own limits. It's critical you choose wisely.

    Have you looked into government policy changes regarding lease and freehold? They were abandoned in Scotland a number of years ago and Westminster is talking about doing the same in England and Wales. I know it's hard to judge how quickly legislation will change but you may well be spending £80K on nothing... well, more than the nothing you are spending it on at the moment, as it were.

    Finally, you're plainly a nice person but completely bonkers. This will end badly for everyone!
    The views expressed here are my own. I am not a Solicitor nor am I affiliated with any of the parties I mention. If you disagree with any of my comments please say in whatever way feels most natural to you. No one self improves in a bubble!
  • chucknorrischucknorris Forumite
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    glennstar wrote: »
    Make sure you use a solicitor with experience in this area. They aren't all the same and they don't all know their own limits. It's critical you choose wisely.

    Have you looked into government policy changes regarding lease and freehold? They were abandoned in Scotland a number of years ago and Westminster is talking about doing the same in England and Wales. I know it's hard to judge how quickly legislation will change but you may well be spending £80K on nothing... well, more than the nothing you are spending it on at the moment, as it were.

    Finally, you're plainly a nice person but completely bonkers. This will end badly for everyone!

    With respect you don't know me, so you are in no position to call me bonkers. It will end badly for my friends if they do not extend the lease, the value of the flat will be zero in 40 years from approx £330k, so (straight line) that is over £8k per annum being lost.

    I am aware that leaseholds are being looked at, but doing nothing and hoping for the best is not IMO a good strategy for my friends. In Scotland it only helped leaseholders who had more than 100 years left on the lease.

    I am not spending £80k (or whatever it turns out to be, that was just their guesstimate, they need to get another quotation). I will be lending the money to my friends, with a first charge on the property (the same as a mortgage company would).
    Chuck Norris can kill two stones with one bird
    The only time Chuck Norris was wrong was when he thought he had made a mistake
    Chuck Norris puts the "laughter" in "manslaughter".
    I've started running again, after several injuries had forced me to stop
  • glennstarglennstar Forumite
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    With respect you don't know me, so you are in no position to call me bonkers. It will end badly for my friends if they do not extend the lease, the value of the flat will be zero in 40 years from approx £330k, so (straight line) that is over £8k per annum being lost.

    I notice during the course of the 4 pages of this post you have grown increasingly irascible, presumably because you aren't hearing what you want to hear. I think the point about a qualified solicitor is valid, as is investigating the leasehold rule changes, neither point of which I can see in any previous posts - although I concede I have not poured over the commentary. The fact that you have chosen to focus on my "bonkers" comment says a lot. I wonder why you have even created this post.

    As for the UK law changes, which, incidentally, has nothing to do with the crackpots running the Scottish government. The 2017 reform proposal stated, as one of its 4 main objectives;
    [To] work with the Law Commission to support existing leaseholders. This will include making buying a freehold or extending a lease “easier, faster, fairer and cheaper.”
    There was also a statement in October 23019 stating that this legislation would be in place before the end of the next Term. I think anyone in their right mind would wait. What difference (genuinely I don't know) will waiting up to 5 years make to the cost/viability of the lease?

    And on that point, just by the bye, it is a common misconception to think that I need to know you to be able to judge your mental state - not true.
    The views expressed here are my own. I am not a Solicitor nor am I affiliated with any of the parties I mention. If you disagree with any of my comments please say in whatever way feels most natural to you. No one self improves in a bubble!
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