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  • FIRST POST
    • NotRichAtAll
    • By NotRichAtAll 13th May 19, 3:03 PM
    • 802Posts
    • 687Thanks
    NotRichAtAll
    Question re loan application
    • #1
    • 13th May 19, 3:03 PM
    Question re loan application 13th May 19 at 3:03 PM
    I am looking at doing my daughter in law a huge favour and applying for a 10k loan for her. Will the purpose of the loan have any bearing on the actual outcome? In real it's to help her with funding for uni, would i be better off saying this or maybe say its for a new car?

    cheers
Page 1
    • Paul_DNAP
    • By Paul_DNAP 13th May 19, 3:07 PM
    • 541 Posts
    • 675 Thanks
    Paul_DNAP
    • #2
    • 13th May 19, 3:07 PM
    • #2
    • 13th May 19, 3:07 PM
    You must absolutely not lie on a loan application - this would be criminal fraud.
    (Although I could be wrong, I often am.)
    • foxy-stoat
    • By foxy-stoat 13th May 19, 3:07 PM
    • 4,422 Posts
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    foxy-stoat
    • #3
    • 13th May 19, 3:07 PM
    • #3
    • 13th May 19, 3:07 PM
    You should be putting down the truth rather than lie on an application form to obtain money from banks.
    • foxy-stoat
    • By foxy-stoat 13th May 19, 3:08 PM
    • 4,422 Posts
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    foxy-stoat
    • #4
    • 13th May 19, 3:08 PM
    • #4
    • 13th May 19, 3:08 PM
    You must absolutely not lie on a loan application - this would be criminal fraud.
    Originally posted by Paul_DNAP
    As apposed to non-criminal fraud.
    • Paul_DNAP
    • By Paul_DNAP 13th May 19, 3:21 PM
    • 541 Posts
    • 675 Thanks
    Paul_DNAP
    • #5
    • 13th May 19, 3:21 PM
    • #5
    • 13th May 19, 3:21 PM
    As apposed to non-criminal fraud.
    Originally posted by foxy-stoat

    Well, maybe it could be dealt with as a civil matter between borrower and the lender, but I think it's more likely to be the state authorities that prosecute, so yes, criminal rather than civil.
    (Although I could be wrong, I often am.)
    • MEM62
    • By MEM62 13th May 19, 3:24 PM
    • 2,474 Posts
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    MEM62
    • #6
    • 13th May 19, 3:24 PM
    • #6
    • 13th May 19, 3:24 PM
    10K is a very generous gift. Perhaps you do not live up to your user ID :-)

    Lying on the application would not be advisable.
    • NotRichAtAll
    • By NotRichAtAll 13th May 19, 5:47 PM
    • 802 Posts
    • 687 Thanks
    NotRichAtAll
    • #7
    • 13th May 19, 5:47 PM
    • #7
    • 13th May 19, 5:47 PM
    10k is not a gift am helping them out. My son and daughter in law have just purchased their 1st house they are both young (23) he works in london, his travelling alone is 7k per yr so they are a bit stuck for cash at the moment and unable to raise it themselves.
    So i apply for the loan in my name, monthly payments met by them.
    • ciderboy2009
    • By ciderboy2009 13th May 19, 6:10 PM
    • 575 Posts
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    ciderboy2009
    • #8
    • 13th May 19, 6:10 PM
    • #8
    • 13th May 19, 6:10 PM
    If they are struggling for cash at the moment then are they going to be able to afford to pay you back each month?

    Presumably you can afford to pay it without any problems if they find they can't?

    Please don't take this the wrong way - it's just that there are plenty of threads on here where people have taken out loans for friends/family where things have gone wrong.
    • zippygeorgeandben
    • By zippygeorgeandben 13th May 19, 6:15 PM
    • 1,005 Posts
    • 1,394 Thanks
    zippygeorgeandben
    • #9
    • 13th May 19, 6:15 PM
    • #9
    • 13th May 19, 6:15 PM
    What? Wait.. ER what again? They've just purchased a house but now they don't have any money?
    Like the other poster has said, what happens if they can't afford to pay you?
    A new sofa here, a renovated bathroom there...
    Savings as of May 2019

    Savings account 1 - 8572.87
    Savings account 2 - 2000.00
    Current account - 6249.30
    Total - 16,822.17
    • NotRichAtAll
    • By NotRichAtAll 13th May 19, 10:04 PM
    • 802 Posts
    • 687 Thanks
    NotRichAtAll
    they don't have any money?
    did i say that?
    Presumably you can afford to pay it without any problems if they find they can't?
    yes
    are they going to be able to afford to pay you back each month?
    yes

    thanks for the replies but we seem to getting away from my original question, i appreciate everyone's concern. my son and dil have money, they are young and starting out what they do not have is 10k sitting round in a slush fund.
    • lewishardwick
    • By lewishardwick 13th May 19, 10:08 PM
    • 631 Posts
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    lewishardwick
    Money and family never, ever mix well.
    • Candyapple
    • By Candyapple 13th May 19, 10:58 PM
    • 3,172 Posts
    • 2,639 Thanks
    Candyapple
    I am looking at doing my daughter in law a huge favour and applying for a 10k loan for her. Will the purpose of the loan have any bearing on the actual outcome? In real it's to help her with funding for uni, would i be better off saying this or maybe say its for a new car?

    cheers
    Originally posted by NotRichAtAll
    Isn't that what student loans are for? Surely she can apply in her own name, why does she need you, her mother-in-law (as in not even her own parents) to take out a loan for her?

    Also, if your son works in London and is only 23 and paying high commute costs, I'm assuming he must be earning mega bucks otherwise why didn't they buy closer? As he's earning so much, surely he doesn't need his mum to step in and pay for his wife's education?
    I'm a Board Guide on the Credit Cards, Loans, Credit Files & Ratings boards. I'm a volunteer to help the boards run smoothly, and I can move and merge threads there. Any views are mine and not the official line of moneysavingexpert.com
    • kelevraz
    • By kelevraz 14th May 19, 1:31 AM
    • 189 Posts
    • 53 Thanks
    kelevraz
    I am looking at doing my daughter in law a huge favour and applying for a 10k loan for her. Will the purpose of the loan have any bearing on the actual outcome? In real it's to help her with funding for uni, would i be better off saying this or maybe say its for a new car?

    cheers
    Originally posted by NotRichAtAll
    Can i be honest? I think if you feel the need to be dis-honest about why your taking the loan, especially if your specifically given the option to put what the loan is ACTUALLY for, that should be a red flag to yourself...

    I don't really think it matters what you put that the money is for... In my years, i've never seen an underwriter take a second look at the 'purpose' for the loan for more than statistical purposes, i've seen a lot of loan agreements and underwriting decisions, someone else may say different though..

    All they care about is that you're NOT using it for the things they specify you CAN'T use it for... housing deposit, gambling, for 'investment' purposes etc etc. And that you don't lie about your income/expenditure

    Whether you put the loans for home improvements / debt consolidation / car purchase - doesn't matter... If in X amount of years, you've lodged a complaint for irresponsible/unaffordable lending. The two things that will be looked at will be
    • Did you lie about how much money you get in? / Did the lender do enough to verify this?
    • Did the lender foresee a possibility that you'd use the money for something you SHOULDN'T have been using it for

    I've never seen a lender/FOS make the argument that 'you said the money was for a car, but then you went a built a new bathroom!'

    So no, in my opinion, it doesn't matter. But, above all, as people have mentioned, i think taking a loan for this purpose is simply a bad idea
    Last edited by kelevraz; 14-05-2019 at 2:09 AM.
    • Sncjw
    • By Sncjw 14th May 19, 4:47 AM
    • 2,152 Posts
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    Sncjw
    Why can’t she apply for student loan like other students so?
    • MEM62
    • By MEM62 14th May 19, 8:02 AM
    • 2,474 Posts
    • 2,136 Thanks
    MEM62
    10k is not a gift
    Originally posted by NotRichAtAll
    It will be. Make sure that you can afford it.
  • archived user
    If they're struggling for cash they have no money to repay you. Unless you draft a legally binding loan agreement then you'll not be able to enforce the loan.

    If you're not prepared to and cannot afford to kiss goodbye to 10,000 then you should not be doing this. Your daughter in law is just going to have to do what other students short of money do and get a part time job. It is perfectly possible to work whilst doing a degree, both my brothers did their degrees (law and business) whilst doing full time jobs doing twilight shifts in a call centre.
    • stripeyfox
    • By stripeyfox 14th May 19, 3:24 PM
    • 339 Posts
    • 315 Thanks
    stripeyfox
    I suppose the risk is that the 10K will be swallowed up within a few months or less. And then what?

    I understand why you'd do it, but there remains the very strong likelihood the money will get spent and if they start to struggle, their repayment to you will be the first thing to be sacrificed.
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