Family Loan

[hazboy]

I lent my sister and my brother in law about �3500.00. they have not paid me back anything for about a year and a half. Every time i ask about money they have none spare. In that year and a half they have brought a car and had social evenings out. I know recently that they have paid someone else �500 that they owed them. I don't really want to take them to court because it would a lot of tension around the family but it looks like i may have no choice.They are really mugging me off. What can i do?

[WendyS]

Do you have any written evidence of making the loan? if not, even it it's family, you could be on dodgy ground as some people don't even regard family debts as debts of honour which have to be repaid. You could try having a word with them telling them you are unhappy about the situation and that you will be writing to them formally asking them to set up a standing order payable to your bank account of �x per month. Tell them that you now need the money and are relying on them not to let you down, having helped them out at a difficult time. Send them the letter and if they still don't respond, you may have to resort to the courts. You say they haven't repaid you anything for 18 mlonths. Was that money paid into your bank account, which you could use as evidence that money was paid to you by them? If they repaid in cash, and you didn't give them a receipt or keep a record it will be difficult for you to prove or disprove any transaction. Just learn the hard but sad lesson that even family members are not always to be trusted and don't loan money again.

[Markandshez]

You never lend money to family - it almost always becomes a gift, as you have discovered. Never put down to malice what can be explained away with ignorance. Sure, they are taking advantage, but thats what families are for sometimes.

Don't "ask about money", - ask them for your money back, week by week, month by month. It will sour your relationship but if money is that important to you you wouldn't have given it them in the first place. I find it funny that you moan about them having "social evenings out" - so you think you own them now do you?

Sorry hazboy but I think you should write it off and let them live with it on their minds and stop letting it wind you up.

[WoWo]

�3500.00 is a lot of money just to write off, but unless you really need it I'd write it down to experience.

I lent some money to a friend once and a similar thing happened in the end I decided it wasn't worth the hassle and worry so I just wrote it off, but I would never lend anybody money again, I might give it to them but I would never expect to get it back. .

If you really want to get to get it back I would suggest writing a nice letter on along the following lines.

Dear X and Y

I'm writing to you with regard to the sum of �3,500 I lent to you which is still to be repaid. I do not wish for this money to cause friction between us so I will allow you 60 days to pay the money. If I haven't recieved all or part of the money or a suitable payment plan to avoid any further conflcit I will sell the debt to a debt collection agency.

We will then be in a much better situation where I will have recovered a significant part of the money and you will no longer owe "me" anything. I would imagine the collection agency will not be as understanding as I have been.

Regards
Z

[erimus1]

Just a note that if your do take it to court for an effective 'breach of contract' the court may not see things your way - one of the requirements for a legally binding contract is that there must be an 'intention to create legal relations'. This could be interpreted as being either by the court - obviously I do not have the privilege of having any further information, so I cannot comment any further

Good luck anyway - and never lend to family members.