Sister refuses to pay me back for money I loaned

[Anon777]

My sister borrowed £2.5k money from me on the premise she would pay it back.

Refuses to pay it back and keeps saying she is broke. She lives with parents with her own flat on rent and has a full-time job. My parents think I am wrong for even asking.

What can I do???

My friend was in a very similar position, right down to his sibling taking holidays in North America, yet refusing to pay him back a penny. However, their parents were no longer around.

He eventually got his money back by threatening legal action (presumably he had some evidence of the loan), but his sibling disowned him. Decades on, he says he doesn’t miss his sibling at all and has no interest in seeing them again. Incidentally, said sibling later became estranged from other family members following a separate dispute over money.

If you have no way of getting the money back, I wonder if it might help to view the £2.5K as the cost of finally freeing yourself from your bullying family? It sounds as though it will be worth it. I hope you now have decent people in your life who care about you and support you.

If they have always been this bad, no idea why you loaned it in the first place.

It's clear that you are angry and venting your hurt @Anon777 but there have been a dozen people saying "small claims court" - this feels like this is something you could do. Could you?

Grass her up to the tax man . Your relationship is toxic and you’ll never see the money again - so go for gold .

Could you send her a letter from a solicitor , maybe she will then start to pay some back.

If there was no repayment schedule or written agreement you may have a problem with lack of intent to create legal relations if you go the small claims route. Have you suggested a payment plan to her? I would definitely do this before issuing proceedings.

2.5K is a lot of money, but if writing it off gives you the push you need to finally have nothing to do with them ever again? I would view it as money well spent. After of course you have written them a letter fully explaining how you feel about them, a catharsis of sorts!

As you have no proof you can’t really do much but I wouldn’t be buying her any birthday or Christmas presents and just saying “that’s £50 less you owe me” each time.

@Anon777 The tax question raised was regarding her status as a landlord. She is liable to pay income tax on any rent she receives over £1000 a year.

Doesn't sound like she's the sort of person who declares this.

www.gov.uk/renting-out-a-property/paying-tax

My horrible BIL and SIL did this to my partner. Took 5k off him with all-sorts of promises to pay it back but never paid a penny. We haven't had anything to do with them now for 7 blissfully happy years.

Partners parents gave all the siblings 40k last year but they got 35k and partner got 45k. I wish I could have seen their faces!

I presume 'she' both times in that post refers to your sister?

But how is she supposedly so poor? Does she have a drug or gambling addiction?

She has wages from a full-time job, rental income (guessing undeclared for tax) and no bills to pay. Far from being poor or even just making ends meet, she has loads of money each month and should have a fortune in savings by now.

Small claims court if you have proof of the loan. I hope she is paying tax on her rental property income. Have no more to do with her till the money is repaid.

God Almighty OP, the more you write, the more unbelievable the situation is.
Re taking her to SCC, I'm not sure I agree with that.
You seriously need to consider 'distancing' as much as possible from your family.
Take care of yourself

@Anon777 there are several ways you can play this.

1. Send a "letter before action" giving her 28 days to pay off the loan in full, otherwise you will start court action against her where she will then become responsible for all associated court costs.
2. Ask your parents for a loan of £2500 then tell them that as your sister owes you the same amount, then you'll pay it back when your sister pays you back. Let's see if they're so quick to back up your sister then...

The other option is if you buy gifts for your parents/sister for Christmas and birthdays. If you spent £100 a year on gifts for them, then that's 25 years without gifts (plus a few more for interest).

If your parents have always paid everything for her why did she need to borrow money off you, why didn't your parents just give her the money. I'd nc all of them, they bring nothing to your life.

I'm not for a single moment suggesting you should actually do this, but how tempting to mock up a fake letter from HMRC and tell her that she is immediately required to start paying the required tax each month on her rental income to 'their' (actually your) bank account - then, when she's repaid you what she owes you, report her to actual HMRC

Sounds like you can't take the legal route to reclaim your money and your sister and parents won't be fair. You can take the noble position of letting it go, go NC etc or maybe there's a way of getting her back....has she got anything you can take in lieu of payment or cause her to have to pay out? Not saying that two wrongs make a right but karma can be a very slow process (if ever).

Please don't do this. What an insane suggestion. I am sure this is illegal

Cut them all off. It cost you £2.5k to find out once and for all how toxic your family are. Forget all this “blood is thicker than water” bullshit and the old favourite “you only have one mum”. Cut them all of and enjoy your life. It’s not your fault you got lumped with them as family but you don’t have to keep them.

This is easy. Right her a formal letter with 28 notice to pay in full. Send recorded delivery.

Then file in Small claims court, with any texts or proof that it was a loan plus any evidence you have of holidays taken etc (that wouldn’t look good) you get interest etc and your court fee on the receipt of a verdict in your favour, you have nothing to lose. Do it tomorrow,

I think the only option here is to accept that £2.5k is the price you've paid to get these awful people out of your life and cut contact. You can't go to small claims as you have no proof that it was a loan, which is likely exactly how they planned it.

If everything you've said about your family is true, why on earth would you have handed over thousands of pounds that you needed back? Why didn't your sister ask your parents for the money, given that - according to you - they're already funding her to the tune of thousands per year?

You need to accept some responsibility for your actions here.

Hence my very unequivocal opening statement...

Well it's obvious that you're never going to get it back, so I'd just stop all contact with them all.

Give yourself the gift of freedom from their cruelty.

Can you borrow 2.5k from your parents and then tell them your sister will pay it back.

Or can you get her to admit it was a loan via text? In a ‘Hi sis, remember that loan I made you for £2.5k a few years ago? Did you ever pay any of it back?’

Why did you lend her the money? Are you scared of her and your parents?

They all sound dreadful and you would probably feel better about cutting them all off.

I would take her to the small claims court if you have anything in writing about the debt and repayment.