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

Is there other examples of him having White Knight Syndrome?

This is absolutely mad.

It would get between me and being married to him, to be honest.

In which case, the friend needs to reign in or halt the project until he can finance the rest. Some builders will loan to clients in some situations to allow the build to be completed (security is the property ie a second charge taken out by the builder against HIS property).

Do not under any circumstances allow this loan to go ahead. Depending on the amount, there’s a strong possibility it could be secured against your own home which would be an absolute batshit thing to do!

The initial loan may will be the thin end of the wedge. After the initial sum is handed over it'll be- I just needed another few thousand to complete the project and then I'll be able to pay you back. After this happens a few times there will be a row after which the 'friend' will cut contact.

This would only be the case if the loan was taken out jointly or one spouse has signed to consent to the loan of the other, or otherwise guaranteed the credit. It’s also not possible to secure a loan in the sole name of one partner, on jointly owned property without the consent of the other partner. The financial settlement in a divorce would look at how the loan money was spent - if it wasn’t used for the benefit of OP or the family, the court would very likely rule that DH clear the loan from his share of the assets without affecting OP’s entitlement.

NO NO NO definitely not, do not let him do it. Tell him if he’s willing to lose that money if anything happens to his friend or the project then let him gladly lend him. You will be liable as your home will be the biggest asset to get the money back if the loan payment fails or what happens if he needs more money where do you draw the line. There’s no saying the bank will lend the money, but personally I’d say no, it would be a deal breaker within my marriage

There is no way in hell I would allow this to happen. You’re married so it’s you and your husband who would be responsible for the loan!!!! No way no way

I would honestly get divorced. No way would I risk my future financial security for DH's friend. If banks think he is not worth a punt - I definitely wouldn't risk it! What if he drops dead immediately after DH gives him the money?

What type of madness drives a person who has debt to take on more debt to prop up a friend who has poor credit? It’s absolutely nuts.
Loaning someone money you already have is lunacy, but actually taking out a loan is just daft. What if the DH suddenly lost his job or couldn’t work?
The friend here needs to accept that the project is done and wind it up. He clearly can’t manage it.

…. Never a borrower or a lender be ..

Creditors absolutely can’t touch joint property if the loan is wholly in DH’s name. Unless OP has signed to consent to the loan, or guaranteed the credit agreement they can only recoup debt from assets wholly owned by him. If the loan is unsecured the lender can’t force the sale of a joint home or place a claim on OP’s share of the property just because her husband owes money. Even if he was facing bankruptcy his creditors could only pursue his legal share in the joint property, and forcing a sale is complicated. OP’s personal credit score may be affected though, as it sounds as though the repayments would be made from a joint bank account which would link it to the debt.

My dad lent his lifelong best friend 80k back when he was in his 40s to help his friend finish his house projects (he was building two houses one to live in one to sell).

my dad had an agreement written up about the repayment and had the deeds to
the house transferred to him until the loan was repaid.

His BFF fell out with him. He refused to pay back anything other than the interest each and every year. Out of spite he didn’t sell either house and just got his family to live in it or rented it out.

My dad had to learn legal proceedings several times due to non payment of the interest.

40 years. Thats how long it took to sort out. The guy only cleared it a few years ago because they are both in their 80s now and he’s wrapping up his personal affairs due to illness.

40 Years of stress.

get a watertight agreement. What if the hit goes bankrupt. Does the loan agreement still stand? As anyone he owes money to would be wiped off the slate?

Get legal advice. Get the deeds.

Some people are just stupid when it comes to money - your husband is one of those, and tbf even though you are objecting to this loan and rightly so, you are probably not very money savvy either. If you are both high earners, yet have debts and no savings, you're not manaing money very well Agreeing to the loan is just another example of your husbands complete lack of financial knowledge or awareness. Even though the personal loan will be in his name, does he really not understand how this will affect you both? Can he afford loan repayments on top of his outgoings already? It doesn't sound like it, if you already have debts and nothing saved despite your high incomes. If he can#t make those payments and defaults, you might not be liable but you will have to pick up the financial pieces, when he can't get a loan or mortgagere-mortgage, or when you have to pay a bigger share of the bills because his money is going on servicing a loan. It would be a deal breaker for me that he was prepared to screw the family over, just to placate a friend.

Gosh I had no idea. I thought as they were married they would both be liable.

Though if you stay married OP and it the friend defaults it will still impact your finances.

This 👆

Even if he manages to get a personal loan, non repayment could end up with a charge on your property. Your husband might think he’s being a great guy but in fact he’s being extremely selfish.

Is your husband likely to be able to get such a large loan without providing security- your house for example?

The only other protection I can think of to put in place is that your DH does the loan to his friend via a solcitor and has a charge against the friends house so that he CAN get it back. That charge would be lifted when repaid. If the friend is not willing to do that, then it can be inferred that he KNOWS that there is a risk he cannot.

Honestly - if he has maxed out all other avenues this is a huge financial red flag as to his ability to repay it. And, like everyone else here, I would say that if he proceeds against your wishes, it is a marriage terminating factor.

OMG I wouldn't even borrow £100 to lend to a friend let alone 10s of 1000s of pounds. There's a reason why this friend can’t get this money himself ...

@Sefal I would be threatening divorce if he did this, and would act on it if he disrespected my views, when I said no fucking way!

.

No she isn’t.

You are married. Even if the loan is not in your name, and he defaults, they can take anything considered a joint possession. I speak from experience. Do not let this happen.

This bloke is going bankrupt no matter what, don't let him take you down too.

Get a HR1 form via gov.uk sorted quickly

That's quite right, but they will force the sale of the family home and account to Op for her half. The monies from the husbands half would be taken to pay creditors.

This is such a bad idea, Ops husband would be risking personal insolvency if he could not continue making payments.

As pp said, the friend sounds as though he's in over his head. The best thing a friend can do is to be there to pick.up the pieces after it's all gone to pot . . .

I would still get proper legal advise! As another poster put their friend was liable for the debts of her husband when they split and my DH said when he and his ex split as part of the financial settlement the details of any loans and credit cards were needed.

A quick google says that £25-35k is the maximum any high street bank would be prepared to offer as an unsecured loan, and OP says what’s needed runs into the tens of thousands. If I were OP I would be very, very wary of DH trying to obtain a mortgage secured on the marital home without her knowledge. She needs to register with the land registry website so that they will alert her to any financial searches from lenders.