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AIBU?

Share your dilemmas and get honest opinions from other Mumsnetters.

Original poster

Withdrawing the offer of a loan

325 replies

ChrissieKeller61 · 02/02/2020 09:04

So very good friend, we’ve lent each other a grand or so over the years both always paid back on time. Complete trust.
She needs £7000 to get out of £28,000 of debt on an Iva.
Currently working full time with kids her life is difficult tbh.
We discussed this, I have about £5,000 I was prepared to lend her which I’ve worked hard for and £2,000 of that is my overdraft, she will cover the charges for when paying me back. Not as though this money is just lying around though.
I want to withdraw the offer and this is why. She’s still spending. This weekend it was another £500 on home improvements. Sensible in theory. But why am I going without and living frugally to help her out when she’s not helping herself.

OP posts:
Bekstar · 02/02/2020 18:43

I offered a full and final settlement of £5.500 on a debt of £7000 8 year ago, I was a year into my IVA They refused it as a final offer and instead I had to pay the £5.500 because they were aware I had been given it (an inheritance) and they reassessed my income evened out the other £1.500 and made me pay it off faster. The only thing it achieves for me was I had paid off the IVA in 2 year. But they didn't sign my completion certificate until 5th year as one of the conditions were I couldn't get any further debt in that time. So I remained on it for 3 year without paying. Any lump sum payments will retrigger a reassessment of her spending and income if she has been found to be spending more than the amount agreed in her IVA it could void it.

MrsElijahMikaelson1 · 02/02/2020 18:46

She will spend your money and you would never see it back so I’m glad you’ve changed your thinking

Original poster
ChrissieKeller61 · 02/02/2020 18:53

Oh I see @Bekstar I might let her find that out for herself don’t wsnt to be the bearer of bad news

OP posts:
maddening · 02/02/2020 19:52

When I reviewed ivas I would have rejected a f&f proposal if a person could afford. £300 pm, ie £18k over 5 years. Your friend is a piss taker,. F&fs were more acceptable if for example there was no monthly available and the funds were from selling their only asset - ie their only other option was bankruptcy.

Original poster
ChrissieKeller61 · 02/02/2020 19:56

Well she can’t afford it, she’s hiding it @maddening so that’s exactly what they will think she’s selling her only asset

OP posts:
Original poster
ChrissieKeller61 · 02/02/2020 19:57

But presumably if she is meeting the monthly repayment they’ll be happy to keep accepting that for some time ?

But anyway as I said earlier I kinda don’t want to know the answered because I don’t want to help anymore

OP posts:
maddening · 02/02/2020 20:03

How is she hiding it? Anyone worth their salt will review her i&e and notice the gaping holes.

Original poster
ChrissieKeller61 · 02/02/2020 20:07

Cash side gig

OP posts:
BumbleBeee69 · 02/02/2020 21:28

have you given her the good news OP ? or just avoiding handing over the cash....

Original poster
ChrissieKeller61 · 02/02/2020 21:48

Just ignoring for now 😬

OP posts:
Wifeofbikerviking · 02/02/2020 21:54

An iva isn't a pay off all at once thing. Its 60 months of payments. She is effectively a step before bankruptcy.
Her income minus outgoings will be the payment so there wont be spare money for you.

Wifeofbikerviking · 02/02/2020 21:55

I used to advise on ivas and bankruptcy a few years back...so please trust me it's a bad idea

Wifeofbikerviking · 02/02/2020 21:55

Oh..I dont know why your latest posts didnt appear till after I posted 🙈oops

Wifeofbikerviking · 02/02/2020 21:57

I'm bloody useless at this site! 🤣

PatellarTendonitis · 02/02/2020 22:43

Just ignoring for now 😬

Look, this is what it is: this person is a total user. You cannot solve her problems because she doesn't want to, she just wants to be bailed out. This is NOT a friend or a friendship, I hate to break this to, but anytime someone is hitting you up for this kind of money, and it's not for some life-saving treatment for their kids or the like, in which case, it would be patently obvious and you would more than likely offer rather than be approached with some cock-and-bull scheme like fake selling you something to cover huge debt, it's a scam.

There, that's all there is to it.

Come March, the rules change on overdrafts and the rates of interest charged on them spike sky high and I can guarantee you will not see a penny from this person and have no savings to cover it. It will become very expensive debt. If you don't believe me, get onto Martin Lewis's site. It's all very clear.

Getting into debt over this is only one thing: stupid.

This person has already shown you and told you that she has no intention at all of modifying her behaviour and is indeed actively seeking out people to enable/con to further her spending habits.

SmellyBeard · 02/02/2020 22:50

You obviously aren't comfortable with it so it's best not to proceed if you're having doubts.

SnoozyLou · 02/02/2020 22:55

Don't do it.

Cornishclio · 02/02/2020 23:14

I am glad you have decided not to do this but I would definitely start to withdraw from this friend and her financial problems as undoubtedly she has brought some of this on herself. She needs to be dedicated to getting herself out of this financial mess before expecting friends to step in and help bail her out. Even if someone is well off that does not mean she should not repay the 5% deposit and I am betting she was dishonest on the mortgage application and did not tell them she had borrowed the deposit. Trying to find a rich boyfriend along with some children to give her more disposable income and allow her to go part time is just madness. Dump this user of a "friend" and ask yourself why you are trying to sort out the problems of someone who does not help themselves.

Overdraft charges are due to rocket in April so I would cancel that £2k overdraft limit and tell her you need your savings so you can go on holiday. Definitely no need to hide that either. You earnt the money so you can spend it however you want. Your "friend" on the other hand has been spending other peoples money and is looking for a short cut to repay it. She will not learn until she is forced to by people stopping bailing her out. Step back from her financial predicament.

HighNetGirth · 02/02/2020 23:20

I think the friend isn’t just a “bad with money” type. She’s a “bad with real life” type. All that fantasy thinking about the money pit house fixing her previous relationship, now the new man fixing her life (along with the misunderstood IVA) and looking after his children to fix up an income.

This is seriously disordered thinking. People like this cannot be pulled from the brink by practical measures like loans and sensible advice. They will hit crisis point again and again.

BumbleBeee69 · 02/02/2020 23:30

just say... unfortunately you are unable to provide the loan anymore... do NOT explain yourself, do NOT give a reason... simply say it's not an option for you now.

If you start explaining yourself you are only giving her cracks to seep into expecting you to hand over partial amounts of the thousands she needs.... d not do it... Flowers

saraclara · 02/02/2020 23:31

She's also a 'bad with friends' person. Because she's prepared to let you go into debt for her when she's not going to be in a position to pay you back (she wouldn't be needing an IVA if she did). And do you honestly think that any of that cash side gig money would have made its way to you, when there are more appliances and house stuff to tempt her?

Waveysnail · 02/02/2020 23:45

OP put your 3k in an account that you can touch for at least a year then takes away temptation

WhenPushComesToShove · 03/02/2020 00:21

OP this shitty person is no friend of yours, just a complete user. So pleased you have your head screwed on and have decided not to go into debt and put your financial future at risk because she can't control her spending and choses to live above her means

BumbleBeee69 · 03/02/2020 00:39

she cannot access your £5K can she ???

Rosspoldarkssaddle · 03/02/2020 00:40

There are lots of reasons to get into debt but here appears from your concerns, to be due to spending money that isn't hers. When banks and cards offer money and credit, it is easy to get into the mindset that it is free money. It is not.
With the changes in overdraft rates, you would be daft to take on her out of control spending, albeit on the house, as your own.
Go back to her and say that you have been reading up and doing your sums and that you are going to have to withdraw your offer of a loan. Getting a loan from you is not clearing her debt and puts your finances in jeopardy. You have to future proof yourself against job loss and unexpected expenses. If she is a true friend, she will be disappointed but understanding. If she puts money before friendship she will go nuts. If she can save £300 per month, she should be paying off her debt with that. She is looking to escape responsibility for her and her husband's spending. They must have family, why are they not getting help from them?