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AIBU?

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Original poster

Should I lend them 10k?

355 replies

SupineSlumber · 24/11/2020 21:16

My parents, in their 60s, are planning on moving house. They’ve found somewhere that they like, and they want to buy it outright with cash, without having to wait to sell their own house first (although they said they hope to sell as soon as possible). However, they don’t have the necessary amount: they have 100k in savings, and are looking to borrow another 100k from selected family members/close friends (not exactly sure as they haven’t told me but I can hazard a guess). They’re very stubborn and are adamant that this is the only way they can secure the house that they love, without being part of a chain etc. Selling their own house would effectively cover the cost of one they’re moving to so they have that as an option but they don’t want it.

They asked me how much I could lend them, and it’s comfortably about 10K. But now I’m thinking this whole thing might be a bad idea. I don’t know who they’ll be borrowing the rest of the 90k from and I don’t want to audited as part of that process (not that there’s anything to hide, but it just seems very messy). Also it just feels extremely indulgent to me, to try to be in the position of a cash buyer whilst roping in lots of people to fund that through loans. What if their house doesn’t sell as easily as they think it will?

Am thinking of withdrawing the offer on the basis that it might not be financially prudent, but I know they’ll be hugely hurt. WWYD?

(NC just in case)

OP posts:
sunflowerstory · 25/11/2020 09:43

Tell them you've decided you want to be a millionaire but don't have the necessary amount. You are very stubborn about it though so can they give you £100k please?

diddl · 25/11/2020 09:45

Tbh as your mum sent a text I'd be tempted to text back.

Something along the lines of "am not able to lend anything at all".

yoyo1234 · 25/11/2020 09:47

Definitely do not "lend" a penny to them.

londonscalling · 25/11/2020 09:48

No. Why should you put your money at risk because of the way they want to buy this.

StrippedFridge · 25/11/2020 09:53

If I were you I would not phone. You will get the brunt of their immediate CF disappointment.

Text to say you are going through the finances in the next couple of days with an advisor (MN Wink and your colleague) to see if you can afford it. You'll get back to them by the end of the week with a final answer on whether you can make a loan and if so how much and on what terms.

Then on Friday you message saying no can do.

Avoid emotional phone calls like the plague. Stick to text so they can process the emotions off line. Don't answer the phone until a few hours have passed and you are feeling secure in yourself.

Repeat like a broken record, "I might not be able to afford it. I have to run the numbers."

Act surprised if they suggest it is a nothing process or zero risk or like you definitely 100% said they could have 10k for sure.

Also "It takes a while to go through the numbers with the advisor. This is a big financial commitment for me with all the risk in the world right now. I'll give you an answer on Friday."

Make sure the messages do not imply you will be giving the money. Have good written evidence just in case their fraudulent activity comes back to bite you.

Fatbottomedgurl · 25/11/2020 09:58

The fact they want you to put in writing that you are giving a gift of money is the biggest red flag I've seen in this whole thread!
That simple sentence means you will have no grounds to chase this money, should they fail to repay it. They are asking for your written agreement that this is NOT a loan. Run for the feckin hills!!

rattusrattus20 · 25/11/2020 09:58

OP absolutely needs to tell her parents to get bent.

If nothing else, the £6k 'second home' stamp duty, which they may not know about since it's a relatively new thing, is real money, and would very comfortably pay for [e.g.] full packing/unpacking services at both ends; a deep clean of the new house; a significant amount of gardner/handyman time to get the new place looking tip top; a lengthy stay in a top notch hotel whilst all of the above is happening. The above would take the stress out of moving at least as well as being chain free, without the need to get into messy financial tangles with friends and family.

Above all, this isn't money the parents 'need', it's something they want for an exceptionally wasteful [given the tax implications] luxuty that probably none of the people they want to borrow from would allow themselves.

nevermorelenore · 25/11/2020 09:58

I'm terrible with financial stuff but this all seems so so shady. And risky, seeing as the property market is up and down at the moment.

If they want to be cash buyers so badly, they can sell up, get their stuff moved into storage and live in a short term rental until they find a house they love.

Missteebeee · 25/11/2020 09:59

Only lend an amount you’re willing to give away

Zenithbear · 25/11/2020 10:00

Who in their right mind would lend £10k to anyone that owns their own home and has a £100k in savings.
Unless you are a multi-millionaire then surely £10k is a lot of money to most people.
They'll have a thousand ridiculous reasons not to pay you back.
"We've decided to retire but you're in our will"
"We would love to pay you back but our poor health means we can't afford to atm..." etc

yoyo1234 · 25/11/2020 10:01

Keep ensuring you state and write loan. The repeated use of the word "gift" in your DM text says a lot. You are completely within your rights to text and make it clear it will not happen if that is how you feel.

MadamShazam · 25/11/2020 10:05

Jesus absolutely not! What a pair of cheeky buggers! They need to wait and sell their own house before they buy another. Like everybody else 🙄 10k is a really big ask, more so as they want it because they can't be arsed waiting.

Foxyloxxy7 · 25/11/2020 10:09

I agree with PP sounds very messy and unnecessary. Have they even factored in the extra stamp duty they will have to fork out and reclaim? They should just sell their house and buy - like everybody else who can’t afford to be a cash buyer.

Starlight39 · 25/11/2020 10:10

This all sounds very shady. Especially that they've turned down the person saying they could buy the house with conditions! And they want you to state in writing that you will "gift" them £15K.

I'd make up an excuse if needed eg I'm in line for redundancy. Just keep saying no. I have about the same in savings - 10K plus 6 months living expenses and there's absolutely no way in the current climate that I'd risk any of that just in case the worst happens.

WhatKatyDidNxt · 25/11/2020 10:11

Another vote to text back, if it’s fine for them to text you then it’s fine for you to text back no. I wouldn’t get sucked into the detail of your decision, whether it’s due a financial advisors input etc

Can’t believe I over looked the additional stamp duty issue. Have they factored it in?!

@1099 wow that’s impressive Shock

DontDribbleOnTheCarpet · 25/11/2020 10:12

So they want you to lend them money they don't need in order to save them the bother of being in a chain, then they want you to sign a document which makes it impossible to force them to repay it, and on top of that they want you to falsify the amount of the loan? And someone else offered to buy the house for them and they could repay that person when they sold the first house, but they said no?

What could possibly go wrong? Grin Brace yourself for an epic tantrum, OP. Once you get through it, your parents may not speak to you for a while, but at least you will have ten thousand pounds to console you!

Original poster
SupineSlumber · 25/11/2020 10:19

@StrippedFridge

If I were you I would not phone. You will get the brunt of their immediate CF disappointment.

Text to say you are going through the finances in the next couple of days with an advisor (MN Wink and your colleague) to see if you can afford it. You'll get back to them by the end of the week with a final answer on whether you can make a loan and if so how much and on what terms.

Then on Friday you message saying no can do.

Avoid emotional phone calls like the plague. Stick to text so they can process the emotions off line. Don't answer the phone until a few hours have passed and you are feeling secure in yourself.

Repeat like a broken record, "I might not be able to afford it. I have to run the numbers."

Act surprised if they suggest it is a nothing process or zero risk or like you definitely 100% said they could have 10k for sure.

Also "It takes a while to go through the numbers with the advisor. This is a big financial commitment for me with all the risk in the world right now. I'll give you an answer on Friday."

Make sure the messages do not imply you will be giving the money. Have good written evidence just in case their fraudulent activity comes back to bite you.

This is good advice. There’s this temptation in me to just avoid the passive aggressive texts, stress of looking at the phone waiting for a reply, and just get the phone call out of the way. But there’s a benefit to not being drawn in too , and the risk of being presented with ‘unexpected’ information on the spot that I haven’t had time to process (a tactic they sometimes use).

Oh there’s definitely going to be a tantrum. Fully prepared to be told that I’m the most ungrateful daughter in the world and how much money was wasted on my education!

OP posts:
Dontbeme · 25/11/2020 10:25

She’s asking me to state that I will gift them 15k (and to show a bank statement with that amount), but (to paraphrase) ‘it’s OK, we know you can only give 10k - that’s fine. We’re not actually asking for 15k, just need you to say you’re going to gift that amount’.

Tell them you will let your solicitor know when you meet him/her to draft up the loan agreement for darling parents to sign.

Honestly OP at this point I would be going low contact with your parents, their sense of entitlement knows no bounds, I am shocked that people are willing to loan them money to buy a second home just because it's what your parents want.

Higgeldypiggeldy35 · 25/11/2020 10:26

What happens if house prices plummet before they sell and they have considerably less equity to pay back all these family members? Sounds like a disaster waiting to happen

Mustbe3ormorecharacters · 25/11/2020 10:27

With a contract and interest yes I would lend them the money.

MimiDaisy11 · 25/11/2020 10:30

It's so dodgy that they're having to lie and say all these people are gifting them money instead of loaning it to them. Also wouldn't be good for you in getting the money back. Best of luck with the call. They're acting so bizarre and irresponsible.

BlueThistles · 25/11/2020 10:38

Sneaky Shady Dodgy as hell... call it whatever the heck you like but the 'particular' wording they have insisted be used on correspondence proves they have ZERO intentions of paying anyone back .. period 🌺

RandomMess · 25/11/2020 10:39

So they want you to commit fraud by saying it's a gift...

Someone has offered to buy the house (sensibly protecting themselves financially) for them and they've said no.

🤦🏼‍♀️

Disaster all around waiting to happen...

friendlycat · 25/11/2020 10:40

This just gets crazier by the minute, if that's at all possible.
Nobody in their right mind negotiates a loan in this way and by text increases it.

They have even had the exceedingly generous offer of the house bought by another relation but naturally with conditions and they have refused that. I can see what you mean about it is all "their way or no way". Well in this case I really think you just need to stick to your guns and stand your ground as it's all getting messier an messier without anything actually having happened yet. Imagine just how messy it would get if you actually went through with this crazy financial scheme of theirs?

As you have been contacted by text yes you could reply by text to allow them time to process and then follow up later with a phone call refusing. However much emotional blackmail you get and whatever the fall out you know you are doing the right thing. I can't imagine that any of the other family "bank loan" members are happy to proceed like this either.

Guiltypleasures001 · 25/11/2020 10:42

Op are you absolutely sure they have not remortgaged their home and are able to pay the money back