Dilemma over loaning money

You have not said, but I am wondering if there's a specific reason why your husband is considering offering a loan to his son. Is the son experiencing some sort of difficulties?

Aldom. He wants to leave his Mother's home and buy a houseboat, which from the photo, looks like a wreck

We give generously, to all our children and theirs, never loan.

My GPs said "Never loan money you can't afford to lose" - Logical.

I agree with Norah’s comment. We only ever gift our DCs money. It makes sense if it avoids some IHT, but if you can’t afford the loss, don’t do it.

If his son hasn't asked for the loan and your husband wishes to support him becoming more independent I think it should be your husband's choice..

However I completely agree with Norah.. make it a gift.. or if you feel strongly that you cannot afford to help him then make your wishes known.. Loans often lead to fallouts

Well I have loaned two grandkids money they both drew up a DD and are paying back on a monthly basis (but without have to pay any interest)
Well if your husbands son is in his 40 s I m not surprised he doesn’t want to live with his mum any longer

pascal30

If his son hasn't asked for the loan and your husband wishes to support him becoming more independent I think it should be your husband's choice..

However I completely agree with Norah.. make it a gift.. or if you feel strongly that you cannot afford to help him then make your wishes known.. Loans often lead to fallouts

I agree, has to be a gift.

(but of course it really depends on your own finances as to how significant it is)

He sounds like someone who isn't navigating life very easily, and it may well come to nothing, but even at 40 you have to make your own mistakes.

Or even, you never know, something good might come of it.

We sorted both DC's fiancial affairs out when they both individually got themselves into a financial mess at university. We most emphatically made them pay it back. Like BlueBelle, we set up monthly DDs.

We wanted our children to learn that money does not grow on trees, and that if they get into a financial mess they have to sort it out and pay everything back the,selves.

It worked. They are now in their 50s and have been models of financial rectitude since. now, of course, wedo give them money, but randomly and, generally, projet directed.

I have seen and advised too many people who constantly bailed their children out of every problem and seen the damage it does to the children and also the relationship between parent and child, for me ever to make that mistake myself.

Thank you for coming back with the information OP.
Would your husband consider helping his son to locate a more suitable houseboat. Only handing over the money at the point of sale. The money would be safe and used for a good purpose. I agree with others., gifting is better than loaning money. I have always given money to my family. But it's for you to decide what is in the best interests of your husband and yourself. Best wishes.

Is he handy? A houseboat could be a good investment if he could smarted it up.

It's difficult.
My son, almost 46, runs 2 businesses but has addiction issues. All the family have loaned him money since he was in his late teens, very little was paid back
A few years ago he was relying on food banks, so each week we paid for online grocery shopping but refused to give any more cash. Harsh but it had to be done. A few weeks ago he messaged to say he needed 2k to keep business going, I told him bank of mum and dad was empty, I've been off work sick since beginning of November

Our daughter and her husband both have good jobs but have occasionally asked for help. Obviously we helped pay for her wedding 2 years ago

It's a really difficult situation

Have you discussed it with your husband?

I think if AC think parents will continue to bail them out they will never learn to stand on their own 2 feet

Please please don’t lend someone £10,000 to buy a house boat.
Just that one thought ( by the son) shows that his thinking isn’t on track.

If you and your husband both agree that you won't need your own money later, then by all means give it to your son. But don't lend it - that's a very fast way to a bitter family feud. Either keep it for your future needs or kiss it goodbye. If your son didn't actually ask for it, then don't even offer. He has his own pride, after all, and he may resent a random big-money gift, which might suggest that you think he's incapable of shifting for himself.

petra

Please please don’t lend someone £10,000 to buy a house boat.
Just that one thought ( by the son) shows that his thinking isn’t on track.

I completely agree.

A houseboat is something one buys as a project, to “do up”, if it’s already quite shabby has said son thought about maintenance? Boats are quite expensive to maintain and can be damp and cold.

Just a thought, but if this son has been living with his mother all this time, with little contact with your DH, why has he not managed to save any money? He could possibly have been working for 20+ years.

Cossy
There’s a reason this sinker ( that’s what we call them) is for sale at 10,000. The now owner has been told to move it.
Two problems there is: he/she can’t afford it, but even worse, nobody wants these heaps of rotten wood because they eventually sink and the yard/river authorities have the cost of removing it.

I loaned some money to a very dear nephew and he promised to pay it back but, after the first instalment, he stopped. He then moved ( was evicted I think) and changed his phone number. I felt so upset as we were once really close and, if he’d spoken to me I’m sure we could have sorted things out. Sadly he died of covid so I never had the chance to do so.
Flo 122, if you can, do try and talk your husband out of loaning his son the money, it will only lead to heartbreak

Wise advice from Monica re value of money.
Wise advice from Cossy and Petra re houseboats.

I’d suggest he offers to gift him half (£5K) and then see what son does with that amount?

petra

Cossy
There’s a reason this sinker ( that’s what we call them) is for sale at 10,000. The now owner has been told to move it.
Two problems there is: he/she can’t afford it, but even worse, nobody wants these heaps of rotten wood because they eventually sink and the yard/river authorities have the cost of removing it.

My Dad had boats, not houseboats, but cruisers, I’m guessing this man is thinking (or not) that this is a “cheap” way to get accommodation. I’d say he’s slightly deluded and very naive.

My view is that if a AC asks to borrow money there should be an expectation that this is repaid.
If offered by parents out of the blue then it should be seen as a gift. Unless it’s clearly stipulated it’s an offer of a loan.
If offered as a gift then obviously no expectation of it being repaid.

What will AC learn about managing money if we allow something borrowed not to be repaid, and worse never to expect repayment. It doesn’t do them any favours.

Please realise as romantic as it sounds “Boat” stands for “bring on another thousand”. We had a narrowboat for a few years which was newish and in good condition. It had all mod cons BUT was expensive to insure and maintain plus cost of waterways licence and mooring costs in a marina.
Personally we continuously seem to bail one dd out. I left home at 18 and never received a penny from my parents as they were struggling financially.

Loans to loved ones or even friends can be problematic but if someone asks for a loan that's what they're asking for, not a gift, and should be prepared to pay it back.

With you there old bat. I left at 17 to live alone in London and regularly had to go to bed early covered by an extra coat because I was cold or as soon as it got dark because I didn’t have the money at the end of the week for the electricity and gas meter in my small bedsit.
My parents could have helped but never offered and I never asked.

I’m another one who says don’t do it! One of my nieces lives on a narrowboat and has done for about 20 years. Her Mum gave her £30,000 to buy it back then so dread to think what a decent one costs now. She then had to give the other daughter the same amount as a deposit on a house. All that money came from what her own mother left her!

I do know there are lots of expenses involved in the upkeep but can’t remember all the technical terms.