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AIBU?

to NOT lend my friend money to save her business?

32 replies

littleblu · 06/11/2009 14:04

I have a friend who has been running her business for a few years now, the recession and bad luck have meant she is not doing well at all. Her house and everything is tied up with the business too. She's borrowed money from her family to save the business recently ( a very large sum ) and now the banks want more or they'll close on her. She hasn't been very clear about what this means though.

I could probably scrape together what the banks are asking her for, but think I'm not doing her any favours really, probably getting her into more debt in the long run. I really don't think I'll get it back.

I love her dearly and don't want to see her lose her house (and her marriage in the process probably) but feel really bad about saying no.

Advice please.......

Oh and she was talking about going on holiday, and I suspect that her DH doesn't know what's going on so she's keeping up appearances.

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PartOfTheHumphreysGroup · 06/11/2009 14:07

No I wouldn't give her any money. Obviously you need to tell her to talk to her DH and not go on holiday.

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thatsnotmymonster · 06/11/2009 14:09

Definitely not.

Why would she lose her marriage?

She needs to be honest with her dh about the state of her business and then they need to look at their options. It is not up to you to bale her out, though it sounds as though you won't be anyway.

She needs to face up to it now before it gets any worse- she may still be able to get out without too much damage!

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Acanthus · 06/11/2009 14:10

Don't give her anything you can't afford to lose and not be niggled by

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NancyBotwin · 06/11/2009 14:12

Yes never lend money unless you are going in with the attitude that you are giving it, not lending it - if you get it back it is nice but you are not expecting it, iyswim.

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paisleyleaf · 06/11/2009 14:12

It's sad. But I think you're probably right in that, in reality, it wouldn't be doing her any favours to bail her out for this time.

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DaftApeth · 06/11/2009 14:23

If she has already borrowed from all of her family and that has ben enough, it is unlikely that what she gets from you would be enough either.

Unless you have loads of money yourself and could easily afford it, I would not do it. It is an odd thing to ask a friend.

It sounds as though she is burying her head in the sand rather than tell her dh what is going on.

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blueshoes · 06/11/2009 14:25

Your friend sounds like she is in denial. If you lend her the money, you will probably never see it again.

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porcamiseria · 06/11/2009 14:25

NO, YANBU. I would never dream of asking a friend for this.

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Morloth · 06/11/2009 14:25

I agree with NancyBotwin if you can't afford to give it (with no strings) then you can't afford to lend it. The strain money can put on relationships is horrible.

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MillyMollyMoo · 06/11/2009 14:27

I'm afraid the truth is if your business is built on credit and loans it isn't a viable business and this is what a lot people who've been playing shop for the past 10 years are learning the hard way.
She'll pick herself up and start again, you or the banks bailing her out is not the answer.

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bumpsoon · 06/11/2009 15:02

Milly valhalla has put a message on the pets boeard for you ,sorry for hijack

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MorrisZapp · 06/11/2009 15:06

Christ! Don't give her a penny.

Does anybody else remember that episode of SATC when Carrie realises that she's spent all her money on inconsequential pish, and then berates her friend Charlotte for not offering her a loan?

I'm still scratching my head over that one.

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MillyMollyMoo · 06/11/2009 15:13

bumpsoon I have that topic on ignore I think I've had all the advice I take thank you.

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Confuzzeled · 06/11/2009 15:24

My dh and I have a business that is struggling, we have borrowed money to survive and it might not be enough to get us through so I understand where your friend is coming from.

Saying that the business isn't viable might not be the case, other factors might be pulling it down.

In our case we had a bad year last year but our business is now getting stronger. The problem is our creditors changing credit terms from 90 days plus to 30 days. Nobody offering payment plans and the banks taking longer to process credit card payments so our money is tied up for longer. The way people conduct business has changed and it's killing hundreds of small businesses.

My advice is to ask to see your friends accounts, is she making money and is she likely to be able to set up a payment plan to make sure you get your money back.

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bumpsoon · 06/11/2009 15:24

sorry ,really didnt mean to interfere ,it just sounded like a woman from a rescue could rehome your dog this weekend if that was still what you needed .Shall b*gger orf now

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Winibaghoul · 06/11/2009 15:24

It's as Warren Buffet says 'when the tide goes out, you find out who's been swimming naked'
That's what has happened in this recession - it's shown that too many businesses have been built on credit, now with credit no longer easily accessible they're going under.
money is tight for everyone, YANBU at all not to lend her the money.

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dittany · 06/11/2009 15:30

This reply has been deleted

Message withdrawn at poster's request.

MillyMollyMoo · 06/11/2009 15:33

I run my business so that I could clear all my debt in 7 days if I had to and that was the way I was taught back in ye olden days of 1997 and i've stuck to it throughout the credit binge, no way would I ever risk our family home or childrens future.
If we couldn't pay our bills at any time then it would have been game over.
Oh and chase your bank because Natwest Streamline haven't slowed down any processing at all.

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solongpumpkin · 06/11/2009 15:40

Its very sad that your friend might lose her business and house but it would be far worse for her to drag her family and friends' financial futures down with her. If you never saw your money again (highly likely) she would feel guilty and you would feel resentful.

Maybe you can offer her emotional/practical support instead.

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littleblu · 06/11/2009 16:29

thanks for all the good advice, I just need to tell her now. Mostly that I'm here for emotional support not financial.

I'm going to earmark a little money that I can afford to GIVE her, so that if it all does go tit's up I'm more than happy to help her out for rent/food etc if she needs it.

OP posts:
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reservejudgement · 06/11/2009 16:55

littleblu, I think that is wise and you sound like a lovely friend!

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GroundhogsRocketScientist · 06/11/2009 16:56

Friends and money are like Oil and Water. They just don't mix.

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LilyLoovesGuyFawkes · 06/11/2009 16:59

Liitleblu that sounds like a good idea!

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Stigaloid · 06/11/2009 17:02

Don't lend her any money - it is her business and she has to deal with it. She should never have tied her mortgage up with her business and it was a risk she and her husband would have taken knowing that this could happen. it is not for you to risk your own family's finances for her - although it shows a kind and considerate nature - it is not worth risking your family for someone else's business.

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TheUsefulSuspect · 06/11/2009 18:19

For a start you're friend should not have asked.

If it is a case of you scraping the money together then you certainly should not consider throwing money at a problem that has already wiped out her money and seemingly her families cash reserves.

As others have said, if you were minted and could in effect "give" her the money, and you thought she could actually turn it around then you could consider it.

It seems that she is just trying everything to save a business beyond saving, and you will not get your money back.

She might get annoyed, but let's face it, if you lend her the money and don't get it back then your friendship will be dead in the water anyway.

I am currently owed less than 500 by a friend of mine, and despite owing me this they have managed to move, go on holiday, go away for the weekend and go out most weeks. Not the friend I thought they were quite clearly.

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