Help with Son inlaws finances
Discussion
Morning All Need some valuable advice. Son inlaw has come to me to confide in me that his parents have financially abused him since he got his first job, racked him up with £27,000 of debt ! He's managed to pay off £17,000 so far. Parents not interested in helping him and now hardly talk.
I'd like to help him. Question is can I draw up my own agreement to lend him £10k with witness to witness signature ?
What format should I use if possible ?
Thank you in advance
Glenn
I'd like to help him. Question is can I draw up my own agreement to lend him £10k with witness to witness signature ?
What format should I use if possible ?
Thank you in advance
Glenn
glennjamin said:
Morning All Need some valuable advice. Son inlaw has come to me to confide in me that his parents have financially abused him since he got his first job, racked him up with £27,000 of debt ! He's managed to pay off £17,000 so far. Parents not interested in helping him and now hardly talk.
I'd like to help him. Question is can I draw up my own agreement to lend him £10k with witness to witness signature ?
What format should I use if possible ?
Thank you in advance
Glenn
Are you sure he's not abusing you?I'd like to help him. Question is can I draw up my own agreement to lend him £10k with witness to witness signature ?
What format should I use if possible ?
Thank you in advance
Glenn
glennjamin said:
Morning All Need some valuable advice. Son inlaw has come to me to confide in me that his parents have financially abused him since he got his first job, racked him up with £27,000 of debt ! He's managed to pay off £17,000 so far. Parents not interested in helping him and now hardly talk.
I'd like to help him. Question is can I draw up my own agreement to lend him £10k with witness to witness signature ?
What format should I use if possible ?
Thank you in advance
Glenn
Point him to CAB, don’t lend him any money.I'd like to help him. Question is can I draw up my own agreement to lend him £10k with witness to witness signature ?
What format should I use if possible ?
Thank you in advance
Glenn
I don't intend to gift him the £10k I'd rather put it in trust for Granddaughter, so I am prepared to lend him the money to save interest charges, But want him to know that he's got to pay it back.
In the form of a interest free loan.Just need to know the format a agreement which he knows he can't get out of.
Any ideas gratefully received...
In the form of a interest free loan.Just need to know the format a agreement which he knows he can't get out of.
Any ideas gratefully received...
alock said:
Assume you're gifting him £10k.
If he chooses to gift you £10k back then that's a bonus.
If you can't afford to treat it as a gift then don't do it.
This. My father taught me this at a young age. If you ever loan friends or family money consider it a gift, if they pay it back consider it a bonus. If he chooses to gift you £10k back then that's a bonus.
If you can't afford to treat it as a gift then don't do it.
If you trust him and are confident that lending him this money will genuinely help (rather than, for example, facilitate bad habits and dig him into a deeper hole), then you can formalise the loan very easily by just writing its terms down in clear, simple English, and then you both sign and date it, and a witness could do the same if you wished. "On the [date] A will loan B £X to be repaid by [date]." If you're going to charge interest specifying exactly how it's going to be calculated can be fiddly, but particularly if it's a loan between family members helping each other, who cares about literally a few quid?
The key thing is that the only real purpose of formalising the loan is to make everyone feel comfortable with the arrangement.
If you ever got close to needing to enforce the terms of the loan, the whole thing has already gone irredeemably wrong.
The key thing is that the only real purpose of formalising the loan is to make everyone feel comfortable with the arrangement.
If you ever got close to needing to enforce the terms of the loan, the whole thing has already gone irredeemably wrong.
The problem with agreements that people “can’t get out of” is that it’s all fine until they breach it. Then what are you going to do? Take him to court? That’s not as easy as it sounds and what if (as is likely) he has no money to pay it back?
For £10k I bet you’d end up writing it off in the end.
As others have said, if you can treat it as a gift that you might never see again then it’s fine.
Relying on an agreement with someone who has no funds? Not so much.
For £10k I bet you’d end up writing it off in the end.
As others have said, if you can treat it as a gift that you might never see again then it’s fine.
Relying on an agreement with someone who has no funds? Not so much.
glennjamin said:
I don't intend to gift him the £10k I'd rather put it in trust for Granddaughter, so I am prepared to lend him the money to save interest charges, But want him to know that he's got to pay it back.
In the form of a interest free loan.Just need to know the format a agreement which he knows he can't get out of.
Any ideas gratefully received...
As others have said, don't. In the form of a interest free loan.Just need to know the format a agreement which he knows he can't get out of.
Any ideas gratefully received...
You might get it back, but having a signed piece of paper saying he owes you 10K is worth nothing if he gambles or drinks it away.
Investigate this financial abuse first if you want to help. Have his parents taken out loans in his name? Get the police involved, that's a crime.
Going through similar with a family member just now.
There are 'free' (to a point) loan agreement templates available on-line that will set out the terms etc.
However, we were looking into a solicitor endorsed agreement and thought for a few hundred quid this maybe more beneficial. However, quotes were coming back around the £1,000 mark so have binned that off.
There are 'free' (to a point) loan agreement templates available on-line that will set out the terms etc.
However, we were looking into a solicitor endorsed agreement and thought for a few hundred quid this maybe more beneficial. However, quotes were coming back around the £1,000 mark so have binned that off.
Have you heard the story from the parents?
I'm confused as to how a grown man get £27k of debt forced on him? I can't understand that, have they being buying DFS sofas, Wren kitchens and white Audis, on finance, in his name? If I am missing something here and being harsh, do let me know.
On a plus note, if he has managed to pay off £17k of the £27k already, with higher interest repayments than on what is left, then he will have no problem paying off the remaining £10k, with smaller interest repayments.
I'm confused as to how a grown man get £27k of debt forced on him? I can't understand that, have they being buying DFS sofas, Wren kitchens and white Audis, on finance, in his name? If I am missing something here and being harsh, do let me know.
On a plus note, if he has managed to pay off £17k of the £27k already, with higher interest repayments than on what is left, then he will have no problem paying off the remaining £10k, with smaller interest repayments.
glennjamin said:
I don't intend to gift him the £10k I'd rather put it in trust for Granddaughter, so I am prepared to lend him the money to save interest charges, But want him to know that he's got to pay it back.
In the form of a interest free loan.Just need to know the format a agreement which he knows he can't get out of.
Any ideas gratefully received...
This reply clashed with my question. In the form of a interest free loan.Just need to know the format a agreement which he knows he can't get out of.
Any ideas gratefully received...
Not going to comment on whether you should or not.
If interest free then simply draw up a one page piece of paper stating the amount and over what time frame of repayment.
Include whether this to be in one lump sum at the end or as he goes.
I / we borrowed £5k off my FIL when we first got married.
I had no money spare after 100% mortgage.
Insisted on paying it back even though he didn’t want it and also said no interest.
No paperwork.
We bought him a nice present equivalent to whatever he would have lost in interest.
Petrus1983 said:
alock said:
If you can't afford to treat it as a gift then don't do it.
This. My father taught me this at a young age. If you ever loan friends or family money consider it a gift, if they pay it back consider it a bonus. How the hell do parents land offspring with £27k of debt in the first place?
If I got involved at all I'd try to get regular monthly repayments by direct debit so that the "loan" is obvious and never gets taken for granted.
MattsCar said:
Have you heard the story from the parents?
I'm confused as to how a grown man get £27k of debt forced on him?
Friend of wife's was in a similar position with her husband - he'd been involved in the family business and finances were all very fluid and inter-mingled. Seemed fine on the surface and they lived in a house the company owned for the first few years of marriage so money was never an issue. Then he fell out with his family and turned out he couldn't stand on his own two feet. I'm confused as to how a grown man get £27k of debt forced on him?
She divorced him.
I don't understand.
He had £27000 of debt.
He has paid off £17000 of that debt, good for him.
So he seems to be in control of the situation and only has £10000 left to pay off.
So why does he need your help?
I just checked the Loan Calculator on Money Saving Expert.
I asked to borrow £10000 over 48 months.
The best deal on offer was Santander at 7.9% APR
The total I would pay back is £11642, so the interest would be £1642
£1642 over 48 months is £34 per month.
Is £34 per month really worth all the aggro and the chance of falling out?
What does your daughter and your wife think about all of this?
Why not gift him the £34 per month. He now has an interest free loan.
He had £27000 of debt.
He has paid off £17000 of that debt, good for him.
So he seems to be in control of the situation and only has £10000 left to pay off.
So why does he need your help?
I just checked the Loan Calculator on Money Saving Expert.
I asked to borrow £10000 over 48 months.
The best deal on offer was Santander at 7.9% APR
The total I would pay back is £11642, so the interest would be £1642
£1642 over 48 months is £34 per month.
Is £34 per month really worth all the aggro and the chance of falling out?
What does your daughter and your wife think about all of this?
Why not gift him the £34 per month. He now has an interest free loan.
Edited by Senex on Friday 30th January 11:51
An agreement doesn't need to be anything fancy, you're not writing a parliamentary bill, and as noted above if you get to the stage of arguing about the correct use of a comma the money's not coming back anyway.
Just set out clearly the situation and what each side is going to do. Approach it as a statement of the facts to make sure everyone is crystal clear about them, and there's no 'oh I thought you meant a payment every other month' ambiguity.
Just set out clearly the situation and what each side is going to do. Approach it as a statement of the facts to make sure everyone is crystal clear about them, and there's no 'oh I thought you meant a payment every other month' ambiguity.
How did the parents get their son £27K into debt - did they keep borrowing money from him?
If he's managed to pay off £17K then perhaps if he keeps going he can pay off the other £10K.
Like others here I would politely decline.
Two years ago a cousin asked if he could borrow £5K (he and his wife had been going on too many cruises). He promised he'd pay it back the next month. Whilst he and I get on perfectly well in normal circumstances, he's made bad financial decisions in the past and I don't trust him with money, especially if it's mine. In the end I lent him £500, being the amount I felt prepared to lose. Even then he took four months to pay it back, citing one excuse after another. God knows how long it would have taken to get £5K back.
Just don't. It's hard but it's necessary.
If he's managed to pay off £17K then perhaps if he keeps going he can pay off the other £10K.
Like others here I would politely decline.
Two years ago a cousin asked if he could borrow £5K (he and his wife had been going on too many cruises). He promised he'd pay it back the next month. Whilst he and I get on perfectly well in normal circumstances, he's made bad financial decisions in the past and I don't trust him with money, especially if it's mine. In the end I lent him £500, being the amount I felt prepared to lose. Even then he took four months to pay it back, citing one excuse after another. God knows how long it would have taken to get £5K back.
Just don't. It's hard but it's necessary.
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