Anecdotal - Friends Have Asked Me To Help With Mortgage After Coming Off Their Fix

[FIGGY]

I really fee for our best friends. They brought at the absolute peak (got a good deal on the place all things considered but it was a total dump) and got a 5y fix.

They are coming off their deal and after being laughed at by their current provider they have asked me to pour over their financial position. This can’t be easy, and for the husband to save face they have asked me to do this via his wife and my wife so in a few days time they are going to open book their life with me.

The wife is a teacher and the husband is a skilled craftsman. They say they never have money (but go on holiday a lot) and have large unsecured debts as well (£20k +).

I do worry for them though, they have no equity in the house (its still being done up 5y later) and I know they took out a 100% mortgage but I’m not sure if they took over 100% to try and pay down other debt (we shall see), its another example of the pinch for people as the come off 5y fixes just as the SVR is going up.

I’m going to send them onto a broker but they have asked me attend this with them as well.

A nosy part of me is fascinated by what I will see as their gross income should be OK c£60k per year, I really hope I can help them out

[Pent Up]

Unless they have a hefty deposit saved it will be the lenders SVR for them. Which may well be better than their fix was.

[man o' the year]

I have helped two friends financially, realising that we may not see the money again and it may have made a difference to them.

Both had asked for help before and when given had fairly quickly paid it back.

It is interesting that neither of them have paid us back recently.

Flame me if you wish but I am not complaining as the money was inconseqential in terms of house fund and as I say I am prepared to not see it again. I post as a anecdote reinforcing the worsening times for many.

[Redcellar]

I have helped two friends financially, realising that we may not see the money again and it may have made a difference to them.

Both had asked for help before and when given had fairly quickly paid it back.

It is interesting that neither of them have paid us back recently.

Flame me if you wish but I am not complaining as the money was inconseqential in terms of house fund and as I say I am prepared to not see it again. I post as a anecdote reinforcing the worsening times for many.

Nice of you to do.

I suspect you are a minority. The 'fix' you gave them though may only have bought them some more time. Sadly, when people are borrowing money it usually means they are about to fail big time. Borrowing a tenner because you're not near the ATM and want to buy some drinks is one thing. Borrowing to keep your life afloat is completely different.

Anyone got any recent figures of those going bankrupt and seeking voluntary agreements? Interested to see how it's change in the last twelve months. I know of someone who works with those in debt, and his business is booming.

[azogar]

Unless they have a hefty deposit saved it will be the lenders SVR for them. Which may well be better than their fix was.

that's what i figured

[Tankus]

Nice of you to do.

I suspect you are a minority. The 'fix' you gave them though may only have bought them some more time. Sadly, when people are borrowing money it usually means they are about to fail big time. Borrowing a tenner because you're not near the ATM and want to buy some drinks is one thing. Borrowing to keep your life afloat is completely different.

Anyone got any recent figures of those going bankrupt and seeking voluntary agreements? Interested to see how it's change in the last twelve months. I know of someone who works with those in debt, and his business is booming.

not so nice to start a thread though

I hope when they do open up to you ...you do act a friend and keep it totally in confidence

[Ah-so]

How much did they pay for their house?

[Pent Up]

not so nice to start a thread though

I hope when they do open up to you ...you do act a friend and keep it totally in confidence

Telling no one but anonymous people on Internet forums.

[FIGGY]

Asking for 'help' or 'information' is often a precursor to asking you for money. Be prepared for your answer and make sure the wife is on the same line as you...because they'll target the weak link.

Good point but it will never ever happen, they are good people and if they had been on the poverty line I would hep them out (I have done this for someone int he past) but they are living a lifestlye on borrowed money (big white wedding paid for by a loan).

No one knows who they are on here and I've kep it even more that way by not referencing the job he has, only talking about him being skilled.

I expect it will be SVR, which is what I said to them. They may be super lucky and have a nice low tracker rate but we will have to see.

I think they like the security of a fix so it will be hard for them to move to something that can change at any time, the current hike in SVR isn't going to help.

[Thread Killer]

I really fee for our best friends. They brought at the absolute peak (got a good deal on the place all things considered but it was a total dump) and got a 5y fix.

They are coming off their deal and after being laughed at by their current provider they have asked me to pour over their financial position. This can’t be easy, and for the husband to save face they have asked me to do this via his wife and my wife so in a few days time they are going to open book their life with me.

The wife is a teacher and the husband is a skilled craftsman. They say they never have money (but go on holiday a lot) and have large unsecured debts as well (£20k +).

I do worry for them though, they have no equity in the house (its still being done up 5y later) and I know they took out a 100% mortgage but I’m not sure if they took over 100% to try and pay down other debt (we shall see), its another example of the pinch for people as the come off 5y fixes just as the SVR is going up.

I’m going to send them onto a broker but they have asked me attend this with them as well.

A nosy part of me is fascinated by what I will see as their gross income should be OK c£60k per year, I really hope I can help them out

OMFG don't whatever you do lend them a penny.

I lent £8K to a "friend" 2 years ago, and never saw a penny back. I had to threaten her with legal action and then it was her husband who had to bail her out by paying me off.

Back to your situation these clowns were in financial trouble yet continued to take holidays.

They're irresponsible, are going down, and you must steer clear of giving them any money while they do so.

[Democorruptcy]

Asking for 'help' or 'information' is often a precursor to asking you for money. Be prepared for your answer and make sure the wife is on the same line as you...because they'll target the weak link.

That is very cynical of you.

(It's exactly what I thought when I read the OP)

[Pent Up]

Good point but it will never ever happen, they are good people and if they had been on the poverty line I would hep them out (I have done this for someone int he past) but they are living a lifestlye on borrowed money (big white wedding paid for by a loan).

No one knows who they are on here and I've kep it even more that way by not referencing the job he has, only talking about him being skilled.

I expect it will be SVR, which is what I said to them. They may be super lucky and have a nice low tracker rate but we will have to see.

I think they like the security of a fix so it will be hard for them to move to something that can change at any time, the current hike in SVR isn't going to help.

I'd be interested to know if they can remortgage with that much debt and no equity.

[SleepyHead]

Sounds like their creditors have the problem, not your friends.

[Killer Bunny]

Anyone got any recent figures of those going bankrupt and seeking voluntary agreements? Interested to see how it's change in the last twelve months. I know of someone who works with those in debt, and his business is booming.

c 130,000 pa. 30,000 in 1999

[Unexpected]

This thread is no good without knowing the size of the mortgage

[dervis]

And the strange thing is when you lend money YOU become the bad guy when you want the money back.

Yep, lent a friend a much smaller sum and have dropped various hints about it, none of which he appears to be taking seriously. I told him at the time I hated lending out money because it always causes problems but he was adamant I'd be paid back. Now he appears to be taking it as a bit of a joke.

Lesson truly learned this time.

[spyguy]

OMFG don't whatever you do lend them a penny.

I lent £8K to a "friend" 2 years ago, and never saw a penny back. I had to threaten her with legal action and then it was her husband who had to bail her out by paying me off.

Back to your situation these clowns were in financial trouble yet continued to take holidays.

They're irresponsible, are going down, and you must steer clear of giving them any money while they do so.

I've a friend who's one of the Ugandan asians.

His family lend each other money between, sometime quite substantial amounts - several 10ks

I asked if they ever worry if they'll ever have someone not pay it back.

He says No. They do do some credit check, check for fecklessness.

But it works out - they lend at rates higher than they can get for cash. The borrower gets cash at a lot less thanthe banks will lend.

Cutting out the middleman.

My youger sister is after borrowing money. Not approached me directly, but implying it.

Of all my siblings, there is no way on earth Id lendto her - ffing lazy.

But I work two jobs she says. Yeah - 4 hours in one, 10 hours int he other.

In an ideal world there should be no problems - she borrows cheap, I earn better than cash.

[gf3]

Yep, lent a friend a much smaller sum and have dropped various hints about it, none of which he appears to be taking seriously. I told him at the time I hated lending out money because it always causes problems but he was adamant I'd be paid back. Now he appears to be taking it as a bit of a joke.

Lesson truly learned this time.

+2

I think the rule is only lend what you would be willing to give so when you don't get it back you're not too disappointed

Edited March 3, 2012 by gf3

[Giordano Bruno]

And the strange thing is when you lend money YOU become the bad guy when you want the money back.

Yes, that is strange but true, imo. It has happened to me.

People who don't want to pay would like to get rid of the creditor. In history, that sometimes meant invading a creditor country (Iran?) or killing the creditors (the Templars?), afaik.

If someone asks to borrow more than I am prepared to lose I would say, 'Go to a bank and borrow off them'. If I do lend I don't really expect to ever see the money again.

'Neither a borrower or lender be' is a good saying, although I do have an overdraft.

[Thread Killer]

Yep, lent a friend a much smaller sum and have dropped various hints about it, none of which he appears to be taking seriously. I told him at the time I hated lending out money because it always causes problems but he was adamant I'd be paid back. Now he appears to be taking it as a bit of a joke.

Lesson truly learned this time.

Assuming you have the debt contract in writing you should nevertheless take legal action to get the money back.

They are not your friend if they attempt to make a joke about it, so you should not fear losing that non-friendship by suing them in court.

But then on the other hand you could ensure they always buy the next round in the pub.

[newbonic]

Yes, that is strange but true, imo. It has happened to me.

People who don't want to pay would like to get rid of the creditor. In history, that sometimes meant invading a creditor country (Iran?) or killing the creditors (the Templars?), afaik.

If someone asks to borrow more than I am prepared to lose I would say, 'Go to a bank and borrow off them'. If I do lend I don't really expect to ever see the money again.

'Neither a borrower or lender be' is a good saying, although I do have an overdraft.

The full quote from Shakespeare over 300 years ago is even more relevant in this context:

Neither a borrower nor a lender be,

For loan oft loses both itself and friend,

And borrowing dulls the edge of husbandry.

Hamlet Act 1, scene 3, 75–77

[easy2012]

I've a friend who's one of the Ugandan asians.

His family lend each other money between, sometime quite substantial amounts - several 10ks

I asked if they ever worry if they'll ever have someone not pay it back.

He says No. They do do some credit check, check for fecklessness.

But it works out - they lend at rates higher than they can get for cash. The borrower gets cash at a lot less thanthe banks will lend.

Cutting out the middleman.

My youger sister is after borrowing money. Not approached me directly, but implying it.

Of all my siblings, there is no way on earth Id lendto her - ffing lazy.

But I work two jobs she says. Yeah - 4 hours in one, 10 hours int he other.

In an ideal world there should be no problems - she borrows cheap, I earn better than cash.

Are you sure about that? These sort of lending are normally quoted in % per month. When they say 1% it means 1% a month

compared to secure lending at 2.x% per annum. Still slightly cheaper than credit card though..

[Sir Harold m]

If a friend or family member needs money and you can and want to help out you should never lend it to them.

Give it to them and mention you'd appreciate it if they returned it if they were ever in that position. Or don't give it to them.

The pressure that formal or informal borrowing puts on a relationship is bad for that relationship. It will also only work if you both have the same attitude to money and debt which is unlikely.

My dad lent some money to my mums cousin when his marriage failed. My dad had spare cash because he was ultra frugal and made huge sacrifices. I could see in my dads eyes that every time my mums cousin bought anything or went on the piss that my dad felt hecwas paying for someone to enjoy something he denied himself.

Myums cousin probably thought his life was shit and he needed to cheer himself up and he'd pay my dad back eventually. Like I said two very different but common attitudes .

As it happened the guy returned the cash with interest a couple of years later but the unease between the two never really went away.

[enrieb]

I’m going to send them onto a broker but they have asked me attend this with them as well.

A nosy part of me is fascinated by what I will see as their gross income should be OK c£60k per year, I really hope I can help them out

It does sound like they are lining you up for something more that just advice, why else would they want you to attend. I'm guessing that when the mortgage lender tells them that they will need to put down a deposit to get the best mortgage deal they will say "where are we going to get 5000 pounds" and then all eyes will fall on you.

[SarahBell]

IF they need help going through a SOA and crossing off things like mobile phone packages, sky tv, eating out etc then that's one thing.

If they want you to help fund their lifestyle without being prepared to make massive sacrificed then screw them before they screw you.