Friend asked dh for 2 year loan

[ParsnipPuree]

Dh’s closest friend broke down to dh and told him he’s in trouble. Owes £25k to a friend who now needs it back. Dh offered to help on the basis it’s payed back in instalments every month for up to 2 years.

I am friends with his wife who is oblivious. Her dh won’t confide in her. She doesn’t know there’s a problem so will carry on as normal. I don’t think she’s a big spender but that’s not the point. They had a week away shortly before her dh and mine had this conversation.

Im angry because if there was a medical situation they couldn’t cover, that would be one thing but they’re obviously living beyond their means. Dh is taking the money out his company so it doesn’t affect me. If my friend knew she’d be mortified.

Make sure your husband gets a legal contract set out, or at the very least gets some type of legal documentation/paper trail.

Hey friend, can I borrow money from you to Kay back another friend? I'll some how magically have the money to pay you back that I didn't have for other friend. Honest.

This. It’s a terrible idea overall, but if he does do it, make sure it’s all legally recorded.

25k is more than most car loans are, and car loans are taken out over 5 years generally. NO WAY can friend pay back 25k in two years. NO WAY!!! If he could afford to do that in two years, he wouldn't need a loan, in the first place, would he? He's taking your husband for a fool.

Thank you all. No I am NOT comfortable with it at all. The bottom line is think is that his family have a lifestyle they can’t really afford.. maybe his salary varies and hasn’t been good this year. Wife doesn’t work and they go on quite a few holidays a year. It’s not her I blame it’s him!!! She’ll never know I knew unless I tell her. He’s never asked dh for a penny before.

Was speaking to a friend this morning who has lent a 'friend' £10k. Said person has made it clear he will not be paying it back and has put himself in a position where small claims won't be viable.

She is so shocked and upset she is having therapy about it. This person was desperate and in need too, really played on her sympathies.

Personally I wouldn't lend anyone other than my child any money. I wouldn't trust anyone else.

No, if he couldn’t afford to pay the first person back how will he afford to pay you back? Don’t do it.

🤣🤣🤣🤣

Of course he did.

Obviously it wasn't because this guy wasn't paying back in good time... Obviously he was diligently paying back the money every week/month....

Otherwise,is he saying he borrowed MORE than £25k off a friend... Why does he need that much money? If it's funding a lifestyle (he's got kids) then that's a another reason not to lend to him.

You have to assume this is essentially a gift to the chancer.

What evidence do you even have that he owes another friend £25k+?

No way. I’d wager that the friend who now needs the 25k back was also expecting it within a reasonable time and your DH’s best friend hasn’t paid. Sure you might get a few repayments in the beginning but just watch, he will ask for a few more days, then wait until pay day, then something else and you won’t get it all back.

Dont lend money you aren’t prepared to give away.

Tell her. Today.

I suspect that friend 1 has been observing the same lifestyle choices that you have observed and has had enough in that case…

No make sure your husband DOESN'T GIVE THIS MAN £25,000.

Is he going to put a written agreement in place? Is the friend going to be liable for the tax liability if he doesn't pay on time? Is it secured in any way - on the friends car [if owned outright or similar]

Unless your husband can afford to be down £25k at the end of the borrowing period it's a bad, bad idea.

How does this friend even know you and your DH have £25k to loan?

It's would be a huge no from me

It’s easy to spend money you HAVE. Hes been spending money he doesn’t have. Thats nothing to do with having kids and everything to do with being financially irresponsible.

And if she doesn’t know about this debt she’ll continue to think all is fine and continue to spend money they clearly don’t have! She NEEDS to know.
As for no drugs/gambling problem and has a big family to pay for how will he afford £1,050 a month for the next 24 months if he’s struggling now?

Aside from all the obvious pitfalls to this - I have my own company and withdrawing that kind of money over and above the income/dividend limits would attract a significant amount of tax. Plus my accountant just wouldn’t let me because it would be fkg stupid and she’d tell me that I might as well burn it. Hope that helps.

I would put my foot down and say no. How can he even begin to say yes. Tell him to ask a bank.

You also can’t know for sure he doesn’t have a gambling problem etc

What a joke borrowed from own friend and now asking another! I would tell his wife.

This is tough OP. Honestly this smells of gambling which is one of the most insidious addictions. I think his wife deserves to know.

Is there anyway to verify this story about other friend needing money back? Surely when that loan was given that friend would know that he doesn't have the money to return. Has he not been paying in installments?

My DH has a wealthy friend who does personal loans as a side business to people he knows. He adds interest and creates an email based contract. We've borrowed money in this basis previously. If you need to change terms, extend the loan or reduce payments, take a payment break etc then its a conversation the same as with any other lender and terms change, interest is added etc He expects the money back and its all very clear as to what the agreement is.
I think it's ok to lend, but properly, with interest (less than a bank if preferable) and payment terms, penalties clear and with contract. Just a willy nilly handing over of 25 grand, then expect not to have it paid back

I think you should tell his DW. Your DH loaning him won’t stop his spending/gambling/addiction & if he’s scared to tell her about the £25k it’s clearly not them living beyond their means bcos she’d know about that. He’s hiding a money problem & your poor DH will be easier unfortunately to default. Not easy I know.

Do not lend money to anyone ever ( unless family and you want to do it )
Your husband is valuing the feelings of his friend’s wife over your feelings. They have several children and she doesn’t work but has a lovely lifestyle? They’re living beyond their means. I’d tell the wife now tbh. They won’t be able solve this unless they’re both working on it together.

Owes £25k to a friend who now needs it back

So he’s borrowing from Peter to pay Paul,
how did he get into this situation with Paul and why wasn’t he able to pay him back in instalments before it got to this?

Is your DH’s friend a high earner? Does his wife work?

I would tell DH and the friend you are going to tell his wife if he doesn't. No way would I keep quiet on this