Author Topic: A Generous Loan  (Read 3444 times)

Inkedup

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A Generous Loan
« on: February 01, 2016, 10:03:14 AM »
I was talking with some friends about family dynamics not long ago. At one point in the conversation, a friend who has the reputation as the most frugal person in our group casually mentioned that she gave her sibling a generous, 5-figure loan for a car purchase. I personally would not have divulged such news, because as soon as she was out of earshot everyone else started buzzing with disbelief. No one praised her generosity, or said how great it is that she and her sibling get along. They were too aghast at the fact that our friend had that. much. money. to think about anything else.

bobechs

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Re: A Generous Loan
« Reply #1 on: February 01, 2016, 10:38:03 AM »
aghast at the fact that our friend had that. much. money.

Nice friends you have.  If aghast is the word you meant.

onlykelsey

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Re: A Generous Loan
« Reply #2 on: February 01, 2016, 10:41:57 AM »
I was recently at a party in NYC (with late 20s early 30s professionals probably earning between 50 and 150K), and my friend and I mentioned in passing that I was considering lending him 20K for six months for a down payment.  People looked at us like we had three heads.  If you don't have kids and you're earning 100K a year, why would you not have access to 20K?

Although then I got hit with a 64K condo expense and had to borrow against my own 401K, so I guess that's a bit of godsmack.

snuggler

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Re: A Generous Loan
« Reply #3 on: February 01, 2016, 10:57:53 AM »
I was recently at a party in NYC (with late 20s early 30s professionals probably earning between 50 and 150K), and my friend and I mentioned in passing that I was considering lending him 20K for six months for a down payment.  People looked at us like we had three heads.  If you don't have kids and you're earning 100K a year, why would you not have access to 20K?

Although then I got hit with a 64K condo expense and had to borrow against my own 401K, so I guess that's a bit of godsmack.

Perhaps they were just shocked that you would lend a friend that much money for such a short amount of time? I'd personally be pretty scared of that, because it's not like the person, if trustworthy and responsible, couldn't just wait 6 months and get the down payment himself. Without further information, it sounds like a huge red flag.

coolistdude

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Re: A Generous Loan
« Reply #4 on: February 01, 2016, 01:49:47 PM »
I was recently at a party in NYC (with late 20s early 30s professionals probably earning between 50 and 150K), and my friend and I mentioned in passing that I was considering lending him 20K for six months for a down payment.  People looked at us like we had three heads.  If you don't have kids and you're earning 100K a year, why would you not have access to 20K?

Although then I got hit with a 64K condo expense and had to borrow against my own 401K, so I guess that's a bit of godsmack.

Perhaps they were just shocked that you would lend a friend that much money for such a short amount of time? I'd personally be pretty scared of that, because it's not like the person, if trustworthy and responsible, couldn't just wait 6 months and get the down payment himself. Without further information, it sounds like a huge red flag.

Snuggler's reply is why any loan I make to family or friends, I consider a gift disguised as a loan. Also, borrowing for a down can be a red flag. If this person is going to make payment for 10-40 years (yes 40 year loan terms exist), they should at least have the ability to save their own 10% down, and some kind of emergency fund for home ownership incidents (plumbing, water damage, AC/heater problems, etc.)

HairyUpperLip

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Re: A Generous Loan
« Reply #5 on: February 02, 2016, 06:21:16 AM »
I was recently at a party in NYC (with late 20s early 30s professionals probably earning between 50 and 150K), and my friend and I mentioned in passing that I was considering lending him 20K for six months for a down payment.  People looked at us like we had three heads.  If you don't have kids and you're earning 100K a year, why would you not have access to 20K?

Although then I got hit with a 64K condo expense and had to borrow against my own 401K, so I guess that's a bit of godsmack.

Wow, what kind of unexpected expense is $64k?

onlykelsey

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Re: A Generous Loan
« Reply #6 on: February 02, 2016, 06:40:29 AM »
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Wow, what kind of unexpected expense is $64k?

my 10% share of a new roof, repointing of five floors of the external walls, and ripping out the entire back wall of the building to reinstall a fire escape that is up to code.  The condo association won a judgment against the folks who converted the building, but we'll never collect, so we're basically out of pocket.

Making Cookies

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Re: A Generous Loan
« Reply #7 on: February 02, 2016, 08:54:35 AM »
Call me clueless - what is repointing a wall?

onlykelsey

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Re: A Generous Loan
« Reply #8 on: February 02, 2016, 09:02:27 AM »
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Call me clueless - what is repointing a wall?

Repointing the brick in the brick wall, to be more accurate.  The building is 100+ years old, and the mortar (and a lot of the bricks) was unstable and basically sand in lots of places.  So (section by section) you support the floor above, then dig out the old mortar, put in the new mortar, let it dry and then move to the next section.  It is very expensive and time-consuming and dangerous in a six-floor building.

Making Cookies

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Re: A Generous Loan
« Reply #9 on: February 02, 2016, 04:06:34 PM »
Thank you.

Sounds like a fun weekend project... ;)