Families eh?. Lent no 2 son £25k for a house deposit a few months back.
Seriously, he ain't a problem, he and his missus earn a bomb and they are honest but I have a nephew who has tapped nearly every member of the family to cover their wasteful spending, kids at expensive private schools etc, and my elderly sister in law has nothing left for an emergency, they've taken nearly all her savings. But they never learn, every time I see them they've splashed out on some expensive unecessary crap, holidays to the US, balloon trips, top of the range smartphones for a 12 year old, expensive games consoles etc.
- Visitors can check out the Forum FAQ by clicking this link. You have to register before you can post: click the REGISTER link above to proceed. To start viewing messages, select the forum that you want to visit from the selection below. View our Forum Privacy Policy.
- Want to receive the latest contracting news and advice straight to your inbox? Sign up to the ContractorUK newsletter here. Every sign up will also be entered into a draw to WIN £100 Amazon vouchers!
Reply to: Lending money to family
Collapse
You are not logged in or you do not have permission to access this page. This could be due to one of several reasons:
- You are not logged in. If you are already registered, fill in the form below to log in, or follow the "Sign Up" link to register a new account.
- You may not have sufficient privileges to access this page. Are you trying to edit someone else's post, access administrative features or some other privileged system?
- If you are trying to post, the administrator may have disabled your account, or it may be awaiting activation.
Logging in...
Previously on "Lending money to family"
Collapse
-
Originally posted by the_rangdo View PostAlways awkward with family. I'm down about £20k built up over a few years helping my parents out and stopping their house getting repo'ed.
Didn't work in the end, and I'll likely never get that money back now. In hindsight it would have been kinder to let things take their natural course.
I have a couple of mates like that. They have the "i want" generation mentality. Swimming in debt, decided to have a kid and get further in. They could work themselves out of it, but any time they free up credit, it's "i want a new *****".
To be fair, when we've helped out, we've been repaid, which has kept us in touch. They are like your parents though, they owe thousands to family members. We've helped out and grabbed stuff when they can't afford to eat, but the OH and I have both said to each other, the only way they will learn is if family stops bailing them out and lets them sink.
Originally posted by psychocandy View PostWim - Bollax mate.
He did his family a favour by giving them a loan in the first place. They shouldnt take the piss now.
Agree with the OP. If they continue to take the piss, time to play hard ball.
Never lend money to family. My brother got divorced years and years ago, he let all the finances slip, house was going to be repossessed, car etc.
I agree they shouldnt take the mick, but I wouldnt assume they are. I personally wouldnt play hard ball with family, but each to their own.
Originally posted by scooby View PostHave to laugh at Wim, with your attitude mate, will you lend me a couple of grand? I'll pay you back when they pay me? I think you missed a little sarcasm and bravado in there...
Originally posted by scooby View PostSome good suggestions in there, and actually spent another hour this morning with the 2 directors. I have, and still will, help them win business. I've even done the stand up tender response presentations for them in the past. I'm doing more than just pressuring. i've been helping them put together a marketing plan today to increase there visibility.
They are owed money, the factoring company wont pay up, turns out the invoiced co has a bad credit rating so the factoring co want the money from them before passing it on. Understandable really.
I keep business separate from personal generally, and I am a different person in both. they know none of this is personal, and they know i want my money. We will still go to BBQ's and have a beer etc. we just wont lend money again! Blood is thicker than water and always will be.
I hope they do sort their business out and hope you dont fall out over it.
Leave a comment:
-
Have to laugh at Wim, with your attitude mate, will you lend me a couple of grand? I'll pay you back when they pay me? I think you missed a little sarcasm and bravado in there...
Some good suggestions in there, and actually spent another hour this morning with the 2 directors. I have, and still will, help them win business. I've even done the stand up tender response presentations for them in the past. I'm doing more than just pressuring. i've been helping them put together a marketing plan today to increase there visibility.
They are owed money, the factoring company wont pay up, turns out the invoiced co has a bad credit rating so the factoring co want the money from them before passing it on. Understandable really.
We have looked at and considered the shares options, the problem being again, is the amount of money owed to them, meaning they owe people too. The assets in the business are leased therefore pointless as the current balance sheet shows a worthless company, so it's awkward to define an amount of shares.
Yes, we have a contract in place and it clearly states i can recover by legal means at any point if no funds are coming in / payments missed. I've agreed with them to let them breathe, but that I am priority debt (wont stand up legally, but they are willing to do it as family). I think ultimately, they really dont want to shaft me due to the family thing. They are trying, but hands are tied. I dont want to push them under, I'm helping them recover the money they are owed. It's just not easy. If i felt that they wouldnt go under if their customer doesnt pay up, I wouldnt be pressuring. I'm not convinced, therefore I need to do my best for my shareholders to recover any monies, regardless of who they are to me.
I keep business separate from personal generally, and I am a different person in both. they know none of this is personal, and they know i want my money. We will still go to BBQ's and have a beer etc. we just wont lend money again! Blood is thicker than water and always will be.
Leave a comment:
-
Looking on the bright side, this does score you 35pts on the IR35 test.
Leave a comment:
-
Don't you think you might be better off investing in a portfolio of shares giving you an average return of 8% than lending some bloke with a small business a few grand for a few percent interest, with a 50% chance of failing within 5 years.
Leave a comment:
-
Originally posted by BlasterBates View PostRight, but it's a loan isn't it, not equity, it doesn't matter whether the company goes stellar or whether it scrapes through you get your loan repaid.
...and be honest how many small startups do you need to invest in to get an apple?
100,000 a 1,000,000
Your chances are probably akin to buying a lottery ticket.
Leave a comment:
-
Right, but it's a loan isn't it, not equity, it doesn't matter whether the company goes stellar or whether it scrapes through you get your loan repaid.
...and be honest how many small startups do you need to invest in to get an apple?
100,000 a 1,000,000
Your chances are probably akin to buying a lottery ticket.Last edited by BlasterBates; 11 May 2012, 11:51.
Leave a comment:
-
Originally posted by BlasterBates View PostSmall business survival rate is poor.
Bureau Of The Census Small Business Survival Rates | SmallBusinessNewz
Never lend to a small business. Within 5 years half of them will have gone under.
Leave a comment:
-
Small business survival rate is poor.
Bureau Of The Census Small Business Survival Rates | SmallBusinessNewz
Never lend to a small business. Within 5 years half of them will have gone under.
Leave a comment:
-
I think I would assist the company in trying to get their £30k back, if I could. Force them to issue a winding up order on this creditor.
You're right to be playing hardball now. If they go bankrupt, I expect you'll lose your money. You'll need to repo something before it gets to that stage.
I've heard so many stories over the years where loans to friends and family go wrong, I'll never do it myself, no matter what. Luckily all my friends and family know that I've got no (substantial amount of) money!
Leave a comment:
-
Originally posted by scooby View PostI've made a big boo-boo! Bailed some family out as their business was struggling (business loan, reasonable amount) after they where broken in to and the unit savaged. This was back in March and the promise was that it would be repaid by end of March.
Now we're in May, and the money is still not forthcoming. They have a customer that owes them big time (£30k+) which I've confirmed as I've seen the books. This outstanding monies has now pushed me to force them to them to withhold stock of the customer (Family are a haulage storage firm) which they have done.
The question is, what do i do now. I want my money back, and quick. Im losing confidence that they are capable of repaying. Do i start recovery proceedings? the contract I made them sign, to keep it all official etc, states i can recover the costs in any way I can. I'm tempted to take a vehicle or two to make sure the money is repaid, the "boys" can sort it...
To be fair Im past caring that they are family, I can deal with the fallout. They need to be reassuring me ASAP that I will get my money...
Suggestions?
Whatever you choose to do it's a tricky situation to be in that's for sure.
Leave a comment:
-
Originally posted by geoff from contracta IOM View PostPerhaps you are looking at this the wrong way ? Is the business sound but just undercapitalised ? You can't squeeze what isn't there and if the businees folds because you are demanding re-payment with funds that aren't there you will likely never see your money they will just liquidate it.
If the business is good and you trust the abilities of the people running it but needs more working capital convert your loan into shares and if necessary inject more money.
What could you add to the business to make it even more profitable for all the shareholders ?
Feel free to disregard my suggestion but think about the problem the way a businessman would not the way a family member who has lent another family member money would, with a different perspective you may just see your money back.
Leave a comment:
-
Perhaps you are looking at this the wrong way ? Is the business sound but just undercapitalised ? You can't squeeze what isn't there and if the businees folds because you are demanding re-payment with funds that aren't there you will likely never see your money they will just liquidate it.
If the business is good and you trust the abilities of the people running it but needs more working capital convert your loan into shares and if necessary inject more money.
What could you add to the business to make it even more profitable for all the shareholders ?
Feel free to disregard my suggestion but think about the problem the way a businessman would not the way a family member who has lent another family member money would, with a different perspective you may just see your money back.
Leave a comment:
-
Originally posted by BrilloPad View PostBut its different with parents though? Shame it did not work - but it must have given them a few more months/years?
Having said that I would never ever let my kids bail me out.
I don't really dwell on it though, what's done is done.
Leave a comment:
-
Originally posted by the_rangdo View PostAlways awkward with family. I'm down about £20k built up over a few years helping my parents out and stopping their house getting repo'ed.
Didn't work in the end, and I'll likely never get that money back now. In hindsight it would have been kinder to let things take their natural course.
Having said that I would never ever let my kids bail me out.
Leave a comment:
- Home
- News & Features
- First Timers
- IR35 / S660 / BN66
- Employee Benefit Trusts
- Agency Workers Regulations
- MSC Legislation
- Limited Companies
- Dividends
- Umbrella Company
- VAT / Flat Rate VAT
- Job News & Guides
- Money News & Guides
- Guide to Contracts
- Successful Contracting
- Contracting Overseas
- Contractor Calculators
- MVL
- Contractor Expenses
Advertisers
Contractor Services
CUK News
- Streamline Your Retirement with iSIPP: A Solution for Contractor Pensions Sep 1 09:13
- Making the most of pension lump sums: overview for contractors Sep 1 08:36
- Umbrella company tribunal cases are opening up; are your wages subject to unlawful deductions, too? Aug 31 08:38
- Contractors, relabelling 'labour' as 'services' to appear 'fully contracted out' won't dupe IR35 inspectors Aug 31 08:30
- How often does HMRC check tax returns? Aug 30 08:27
- Work-life balance as an IT contractor: 5 top tips from a tech recruiter Aug 30 08:20
- Autumn Statement 2023 tipped to prioritise mental health, in a boost for UK workplaces Aug 29 08:33
- Final reminder for contractors to respond to the umbrella consultation (closing today) Aug 29 08:09
- Top 5 most in demand cyber security contract roles Aug 25 08:38
- Changes to the right to request flexible working are incoming, but how will contractors be affected? Aug 24 08:25
Leave a comment: