AIBU to object to my husband taking a large loan for a friend?

if he’s going to do this he needs a loan agreement drawing up by a solicitor in case it all goes pear shaped.

Jeez oh.

Is there or has there ever been a Brokeback Mountain element to this friendship!??

Makes absolutely no sense.

Who in their right mind prioritises a friend over their spouse jeopardising the family future and security over a high risk project?

OP you should let your DH read this thread, and his ‘friend’.

I’d be very surprised if he can get an unsecured personal loan for over £50 000 is it under that amount?
This is bonkers however if he insists on going ahead and he can’t get an unsecured loan against joint assets without your consent. I’d be very vigilant about paperwork arriving at the house and checking what is secured against the property if owned via land registry, I think you have to pay a small fee.
If he goes ahead with an unsecured loan make sure your money isn’t going into a joint account, agree on a division of money for bills etc and pay that into the account.
I don’t see how this won’t affect joint finances and your standard of living, it sounds like he’s determined to go ahead. Keeping your money out of the equation at least means you have some way of trying to build savings but I’m not sure long term especially if the friend defaults on the loan how you’ll be able to forgive him choosing to do this over your expressed wishes he doesn’t.

I always think if I cant afford to lose it, I cant afford to give it.

And DH cant afford to lose it if its a loan. Which he of course should have your agreement to take out as the monthly payments will impact your standard of living regardless of why he wanted it.

Now the friend.. why cant he get his own loan? Runs a big company turning over what sounds like close to millions.. why cant he get a business loan or a personal one? What does the bank know your DH doesnt?

Surely friend had a financial forecast? Why is he so under budget? Where are the other investors?

Tbh i might be telling DH this is a deal breaker.. that if you had it and it was a reasonable amount fine but you dont and it isnt

Your DH needs to tell his friend the bank wouldn't agree the loan due to his and your other financial commitments. He saves face and the friendship remains.

I would never agree to lending a friend or anyone money like this, it would stop me sleeping.

OP, your DH wouldn't do something stupid like get the loan anyway even though you have categorically said no. If he did I would divorce him as all trust would be gone and knowing he put his friend before his wife and children would be the end of the marriage for me.

Your husband is being an absolute fool.

Who is going to make the monthly repayments until the property is sold?

What if the property doesn't make as much profit as expected - where would your DHs loan lie in the priority of repayments? i.e. will all other debts be repaid first? What if there's no profit left after those loans have been repaid?

If your DHs loan is defaulted upon for any reason then yes, as his wife, you would also be financially liable and it would impact on your credit rating.

If he does go ahead, I would insist on him setting up a formal legal agreement.

To echo everyone else this has disaster written all over it. It is also showing shocking disrespect to you and to your marriage and I’d be seriously questioning my future

This is insane.

No true friend would ever expect another friend to get into debt. Repayment is not guaranteed. All jam tomorrow promises. If it all goes pear shaped the friendship is dead anyways as likely his ‘friend’ will be too busy feeling sorry for himself and his own losses to care about your DH’s.

Sounds like your DH has already agreed. He’s likely feeding off all the gratitude from said ‘friend’. +He’s showing you if it comes to a choice between upsetting you or upsetting him, he’d rather upset you.

You’re not wrong. This loan is madness, the project might still not complete or take ages to sell or sell at a loss.

Your DH is insane. Can the friend afford the replacements each month? Can anything legal be drawn up eg you get the money back when the house sells?

I wouldn't rule it out 100% BUT...

This shouldn't be a mates loan. It needs to be a business arrangement e.g. your DH is investing in a building project and his loan will be as a percentage of the build cost and therefore a percentage of the profit.

E.g. build cost £400k. Your DH is loaning £40k so he now owns 10% of the build. If the build then sells for £600k, your DH gets £60k back.

To do this he needs to sit down with friend and go through the business plan and look at costs and time lines. Running out of money with 18 months still to go is worrying and I'd question why this happened. Very bad planning usually...

And as your DH is a very high earner but with no savings then this also implies he isn't great with money either.

No chance - no

Will he make a profit if he's upto his eyeballs in debt? His official creditors will need to be paid off first, and there is no guarantee that they will be. It's based on a hypothetical sale price that may not materialise.

What if he runs out of money again after your husband's injection of cash? Because that seems to have happened already. Maybe more than once.

Why are you in debt if you are high earners? I think he needs to address his own debts before taking on more for a friend. If your husband earns enough to borrow tens of thousands, then why has he not earned enough to pay off his debts, or to not get into debt in the first place? It doesn't really suggest that he makes good financial decisions.

• Has he already asked a lender if he can borrow the money? Surely the lender will ask for the reason for the borrowing and they may not be happy to lend him the money for this reason. If he lies, then that's fraud.

He has "failed" using his own money and loans and is way out of his depth, you have absolutely no guarantee he wont "fail" with your money on top as well.

The banks will probably have a charge on the property already so DH will have no chance of recovering his money when it does finally go belly up, 99.99% chance it will

NOTHING BUT NOTHING IS WORTH THIS RISK - Not even for a friend

At least in your case you were being reimbursed each month for the loan payments, however stressful that was. In OP's husband's case, he will be making all the monthly payments and won't be re-paid until this project is finished (which has a very vague timescale) and the building sold. It's obviously been a complete money pit up until now and there is nothing to suggest that it will get any better.

This. In the event it goes ahead, and it needs to to get it completed, you and your DH need to have certain rights. A charge of value against the property in the event the money isn't repaid, the right to instruct a builder of his choice to get it completed and realise the asset etc.

It's a minefield but, dealt with legally, it could be OK. No way would I accept him randomly handing over money with no legal agreement in place.

Just to add OP large houses are not selling
Apparently the worst time to sell since 2008.

We put our five bed up for sale eight months ago. Two viewings and one private offer from a family friend. If that hadn't have happened we'd be still trying sell it.

If you husband is determined to help his friend in this way, makes sure he Instructs a a lawyer to draw up a proper legal charge over the property for value of loan and to record terms and conditions, the charge is properly registered, and he gets professional valuation of the property and completed project, and to confirm that the complete project is projected to make a profit, and the expected completion date.

It seems all you can do is to minimise the risks rather than just opposing it but it going ahead in a more haphazard way despite your objections..

OP is your husband being coerced to take out this loan? Honestly in years of being on here this is one of the most batshit crazy posts I’ve read!

Has the friend 'promised' a cut of the profit to your husband when he sells the property? It's the only way any of this makes sense! Who knows if and when the property will sell in order for your husband to receive even the original loan back. You are definitely not BU. Your husband is not thinking straight.

If you are married this loan is half yours anyway. Whoever’s name it is in you would be liable and in any divorce you would take half.

The friend of your dh is no friend, putting your dh in this position.
When and how did he ask? Does he have form for borrowing from friends? Is he married?
It does sound as if your dh is being manipulated by this person and put under pressure. Just because you have a top job and earn loads of money doesnt make you immune to scammers, even if they are long term friends.

Its clever he only approached your dh, who feels under pressure to help a friend. Youve had a row, and now you are the bad guy and telling your dh what to do. Your dh wont listen to anyone, because he thinks he is lending his own money. He is not. You are going to have to support him in this insanity, at which point you say why didnt friend ask us both?

Has this friend sold his house and potless to have to ask your dh for money? I would put everything down on a spreadsheet and say - we cant afford it. In front of friend. The advice above to put an alert on land registry is brilliant.

Say you both need 3 months to think about it. Or a month. Friend will put pressure on to hurry up as its urgent. Have you ever watched ' the following is based on a pack of lies?'

I don't know much about loans, but could he get something legally drawn up for his friend to sign? I think I would do that, if not, then no loan.

Surely your DH isn't thinking his loan might save the project from disaster and make him a profit too? From what you say, it sounds like a money pit and pouring more cash into it is beyond stupid. Maybe he feels obligated to help his friend and it's disloyal to say 'No'. That's too bad. If loyalty to a friend means putting his own family's needs and financial future at risk, 'No' is the only sensible answer.

No such thing as good friends when it comes to money, at the end of the day your husband would be liable to pay the monthly installment if his friend didn’t and if he has got to this part of the project and maxed out everything I would be loathe to lend him a penny.