Loan not being paid back

Please don't write a formal letter asking for the money back. Just speak to her and try and maintain your relationship, you are her parents

In practice it’s best to write it off because there is no written agreement, daughter will probably ignore you anyway. Involving solicitors and courts is only going to cause you more grief.
You can leave your estate to whoever you want but you must provide for your surviving spouse

That's interesting Germanshepherdsman. We did invest money into our ES's and wife's house for their deposit, before we were estranged of course, and had a charge against the house drawn up.

I wonder if Frogsinmygarden might come back to let us know if she made any progress and, hopefully, has seen her DD.
It was a salutary tale and a very sad one too.

Kali2

I understood there were tax implications if it was a loan.

If you charge interest you must declare the interest receipts as income. But apparently N/A here.

Sorry I should have been clear. I meant England and Wales, not UK

I understood there were tax implications if it was a loan.

I learned a long time ago that where money’s concerned people just can’t be trusted. It changes people. I’ve seen it several times.

The last of your savings! You have been silly and I feel for you. We never like to view our children in a bad light but the blinkers have to come off now. I don’t know what advice to give. You’ve had some good replies. I wish you well and hope you get some, if not all, of your savings back.

Kali2

GillT57

Kali in UK there is no legal requirement to leave your estate to your children as it is in France I believe. Any of us can make a legal will and leave our estate to whoever we wish, as many people have found to their great surprise in the death of a parent. However, if there is no will, the usual laws of the inheritance apply

Thanks, I was not sure.

Might be an old post, and must say I did not notice this. But it is a very 'interesting' situation that could happen to many. I do wonder what happened, and it would be so interesting if the OP could update.

When we have helped with deposits, we were told that legally it could not be a loan, but a gift- but that it could be deducted from inheritance if not all children have had the same help.

There's no legal reason why the money can't be a loan, but the fact that it comes from a third party should be declared to the lender.

As I said up thread

singingnutty

As some posters have pointed out, if a mortgage is involved parents will be asked to state that the money is given without strings attached and they will make no claim on the property. We did this with money transferred for our son to help with his house purchase a few months ago. However this was actually money we were holding for him after the settlement of my father’s estate so no worries about repaying it. I agree with what others have said about best not to lend what you cannot afford to lose.

It's likely the daughter lied and said the money was her savings Smileless. If she had revealed that the money had been either loaned or gifted her parents would have been required to sign a form saying they had no financial interest in the property. So unless OP didn't mention that, the daughter lied.

GillT57

Kali in UK there is no legal requirement to leave your estate to your children as it is in France I believe. Any of us can make a legal will and leave our estate to whoever we wish, as many people have found to their great surprise in the death of a parent. However, if there is no will, the usual laws of the inheritance apply

I believe that is the case in England. It is not the case in Scotland where a child is entitled to a share of the estate.

I read Judge Rinder's column occasionally and he never holds out much hope in a case like this where there is no written, signed and witnessed agreement between all parties. I would get an urgent appointment with a reputable solicitor to see where you can go from here. I really feel for you.

GillT57

Kali in UK there is no legal requirement to leave your estate to your children as it is in France I believe. Any of us can make a legal will and leave our estate to whoever we wish, as many people have found to their great surprise in the death of a parent. However, if there is no will, the usual laws of the inheritance apply

Thanks, I was not sure.

Might be an old post, and must say I did not notice this. But it is a very 'interesting' situation that could happen to many. I do wonder what happened, and it would be so interesting if the OP could update.

When we have helped with deposits, we were told that legally it could not be a loan, but a gift- but that it could be deducted from inheritance if not all children have had the same help.

As some posters have pointed out, if a mortgage is involved parents will be asked to state that the money is given without strings attached and they will make no claim on the property. We did this with money transferred for our son to help with his house purchase a few months ago. However this was actually money we were holding for him after the settlement of my father’s estate so no worries about repaying it. I agree with what others have said about best not to lend what you cannot afford to lose.

Oh I thought it was January 2022, and it's from January 2021.

This is a very unfortunate situation Frogsinmygarden and I do feel for you. It's heartbreaking when the trust you have with someone, especially your own child is broken.

I think the suggestion to write to her is a good one. Explain that you are disappointed that no effort has been made to start paying back the loan, that it was the last of your savings and you are concerned that it will not be repaid. Ask her to let you know when she intends to start repaying the loan and how much each instalment will be, as you're in need of additional income.

IMO when money is loaned, whether or not there is anything in writing, the recipient as well as the lender know this to be the case and know that loans are to be repaid. That is the difference between a loan and a gift.

If the money is not repaid and you wish that to be your D's only inheritance, you can state that in your will as the reason for her not being a beneficiary, if that's what you decide.

If a charge was to be made against the house, it would have had to have been made at the time the mortgage was taken out Soupy and at the behest of the those providing the cash deposit, to protect their investment.

Understandably, some parents are unwilling to pursue legal recognition of monies loaned in case it's seen as a lack of trust in their AC, which makes it all the more hurtful when by making no effort to re pay the loan they do indeed break the trust that's been placed in them.

Oops old post!

GillT57

Kali in UK there is no legal requirement to leave your estate to your children as it is in France I believe. Any of us can make a legal will and leave our estate to whoever we wish, as many people have found to their great surprise in the death of a parent. However, if there is no will, the usual laws of the inheritance apply

I’m prepared to be wrong, but I understood that in Scotland you couldn’t disinherit your children.

I hadn't spotted it was a necropost. I suspect it was reanimated by the poster offering a link to payday loans.

When you loaned her the money, did she also get a mortgage? Usually mortgage providers require money from parents to be a gift and not a loan. They usually also require a letter from the giver to confirm the gift.
Did you send such a letter. If you did then I’m afraid there is no comeback, other than the receivers conscience.

Kali, Yes, you can.

OP - and other contributors, there is no point in crying over spilt milk or discussing what you ought to have done. The OP is faced with the fact that her daughter has the money and she is not going to pay it back.

I understand your grief for the daughter you thought you had. You must be devastated by her behaviour, as I would be in your situation.

With nothing in writing and the possibility that you may have said to the solicitor it was a gift, even though you are not aware of having done this, it is very difficult to know what you can do to get the money back.

What you now need to consider is how you can replace those accessible savings. You do not say that your daughter is an only child, but I suspect she might be, You also do not say whether you are house owners or not.

If you own your house you could release some of the value of your house through equity release. It works a bit like a mortgage, but instead of paying it back or paying any interest, the interest is added to the loan each year and when you sell the house, either to go into care or after your death, the money and interest are repaid.

To show how it works. Take a house worth £350,000, £100,000 equity release and interest of 5% a year. You would get £100,000 and instead of paying interest at the end of the year the money due back to the lender would be £105,000. The year after that 5% of £105,000 would be added on and so on.

If you decide to do that, you could then write to your daughter, tell her what you are doing, why you are going to do it and point out that that means that you will probably have very little to leave her when your died as the money you are taking out of the house and the rolled up interest will account for most of the value of the house.

This just might galvanise her into action and repayment. If it doesnt, go ahead with the equity release. You will then have some money behind you that you can access easily and she will just have to accept that her failure to repay the loan will severely cut into any inheritance she may have expected.

Damn! Didn’t look at the date!!!

You know where you went wrong so there’s no point rubbing your nose in it.

I would second writing a letter as suggested above. That sets out your position and gives her an opportunity to engage with you. Send it by recorded delivery so you have proof she’s received it. On no account tell her at any point that she’s had her inheritance as then it will become a gift.

As you say the loan used up your savings, I assume you really can’t afford to write it off. In view of the fact that she’s decided to distance herself from you, I would advise going to a solicitor if your letter doesn’t produce an acknowledgment of the loan and a repayment plan. It will be emotionally difficult and it will be your word against hers but common sense would tell the judge that you wouldn’t have given away the last of your savings.

I hope all goes well. In the meantime do revisit your wills as soon as possible and ask a solicitor to revise them to take account of the current situation. They can be suitably worded to cover a situation in which she has repaid some or none of the loan, and your right to repayment of the balance passed on to anyone you choose.

Well, it’s just over a year since the original poster posted, so the issue has either been resolved now or she does not wish to add any more detail.
I hope it was resolved.