Loan Repayment

[DavidBowiesNumber1]

A family member has asked if I can loan them an amount of money. I'm quite happy to do so as long as the monthly repayments include the interest I will have lost. I need help to work out what the payments should be.

Loan amount: 13,150
Term of loan: 14 months
My savings interest rate: 12.5%

Can anyone please tell me how much I should receive each month to cover my lost interest?

Well according to THIS calculator, you would lose nearly £2,000 in interest, assuming your savings account pays annually.

I will have to say though, don't do it!!! What if something happens and the other person can't repay? What happens if you fall out and they just don't want to repay? I think this is a one way street direct to trouble.

That is a very very good interest rate though, where do you get 12.5% interest on savings??

There's probably a good reason they are asking you and can't get credit elsewhere.

Don't do it. The interest rate seems quite extortionate.

That's a loan shark rate and no way do you get that as interest on savings. It would be a rip off.

Perhaps the interest is 1.25%? That sounds like a realistic interest rate. However, If your money is tied up in some high risk investments where you've been lucky to get a return of 12.5% in the past year, then there's no guarantee that you wouldn't lose 20% this year...

I think they should go to a bank and if their credit rating is good, they won't pay above 3% interest.

12.5% interest rate? Where do you get that from, planet Dosh?

12.5% interest rate? Where do you get that from, planet Dosh?

I don't live in the UK and I can assure you the I do receive 12.5% interest monthly on my savings.

So, can anyone help me?

Seems a bit mean to me for a family member but each to their own.
I could work it out for you but to be frank I don't want to.

Thank you IsDaveThere

Well interest on 13150 for 14 months at 12.5% APR is 1,917.70 I believe.

So why bother posting Amaried? This isn't AIBU....

Ah. Good for you getting such a good rate.

In all seriousness, lending between family and friends isn't a good idea. Something usually happens and people can't or won't repay and you will be the bad guy. The saying 'no good deed goes unpunished' comes to mind.

Probably not helping you, but be warned!

Thank you Speedy85