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Jo C.
Jo C., Barrister
Category: Law
Satisfied Customers: 70720
Experience:  Over 5 years in practice
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Wondering if you can assist. I require a loan however

Resolved Question:

Hello. Wondering if you can assist. I require a loan however I have been offered a sum of money by my friend, he has advised that he does not require me to pay him back however who knows what may happen in years to come. I want to do this 100% legal with no come back and with terms that I am happy with for example minimal payments so I am thinking that we agree a contract for a long term 0% interest loan. I can then pay back the loan in my own time. He'll be happy and I'm assured that he wont require me to pay it back in one lump sum in years to come. Please can you advise what my options are. Many thanks.
Submitted: 2 years ago.
Category: Law
Expert:  Jo C. replied 2 years ago.
Hi.
Thank you for your question. My name is ***** ***** I will try to help with this.
To achieve what?
Customer: replied 2 years ago.
Hello Jo. The loan would be to invest in property development.
Customer: replied 2 years ago.
to confirm, he isn't offering it as a loan, he is offering it as a gift but I don't want a gift and neither do I want him in 5 years time to ask for it back hence the gradual payments over a long period at 0%. that way we have agreed that he will be paid back but at my terms.
Expert:  Jo C. replied 2 years ago.
Ok.
But your options to achieve what?
Do you have a specific question about this?
Customer: replied 2 years ago.
I need long term security that he isn't going to suddenly request this money on short notice hence the contract. is a contract such as this common, or possible and legal?
Customer: replied 2 years ago.
in other words a long term loan, no periods set, at 0% interest with minimal payments should the investment work out.
Expert:  Jo C. replied 2 years ago.
It depends how much money you are prepared to spend on this.
You could get any high street solicitor to draw up a contract conditional upon the investment reaching a certain return. There will be cost in that.
The other alternative, if he is saying that he doesn't want the money back, is just to get him to confirm in writing that the money is a gift not a loan. Then you are not under any legal obligation to repay but if you choose to do so it can be at your leisure.
Can I clarify anything for you?
Jo
Customer: replied 2 years ago.
Hi Jo thank you for the response, the amount is £25k, can you give a gift of this amount and wouldn't there be tax implications?
Expert:  Jo C. replied 2 years ago.
Yes, you can gift any amount,
Yes, you would have to declare it although obviously that is a tax question rather than a legal one. There may be some exemptions that apply.
Customer: replied 2 years ago.
My view is that I am not accustomed to hand outs. my preference would be to pay him back gradually and have a contract drawn up as to specify the funds will be a long term loan at 0% interest with an undisclosed time period. As long as you are saying this is legal and I'm not breaking any laws then this will be what I will do. what are your thoughts?
Expert:  Jo C. replied 2 years ago.
Yes, and also that would mean there are no tax implications as it is a loan not a gift.
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