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Aston Lawyer
Aston Lawyer, Solicitor
Category: Law
Satisfied Customers: 10459
Experience:  Solicitor LLB (Hons) 23 years of experience in Conveyancing and Property Law
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I want to loan £65000 to a close friend to help her

Customer Question

Hello
I want to loan £65000 to a close friend to help her buy a new home. I am absolutely in no rush to receive the repayment and without interest. However, I want the whole amount covered should she die before it is repaid to me. Also, should I die that the whole amount is repaid to my estate in order that my two daughters mentioned in my will received same on the same terms
Regards
Anthony Woolley
Submitted: 1 year ago.
Category: Law
Expert:  Aston Lawyer replied 1 year ago.
Hi,Could you please confirm if your friend also intends taking out a standard Mortgage with a Bank/Building Society to finance her purchase?Many thanksAl
Customer: replied 1 year ago.
Hi
No mortgage all the funds are in her savings bankAnthony
Expert:  Aston Lawyer replied 1 year ago.
Hi Anthony,Thanks for your reply.As your friend won't be having a Mortgage, (if she was, then it is unlikely that the Bank/b society would consent to her having a further Charge with you), I would suggest that a simple Charge document is drawn up- this can be downloaded from the Land Registry website and is called a CH1.This form will document how much money you are lending her and the terms for repayment. Upon completion of her purchase, this CH1 is then registered at the Land Registry, so that you have a Charge over the property- meaning that as and when the property is sold, you are safe in the knowledge that you will get back what is owing, if anything.Please note that unless you specify in the CH1 a date by which all the monies need to be repaid, you would only be legally entitled to get your money back as and when the property is sold, whether this be in 5 or 50 years time.On a general point, I do strongly recommend that you do indeed proceed with a CH1, as this is the only way you are going to be able to protect your monies!I hope this assists and sets out the legal position.Kind RegardsAndrew
Customer: replied 1 year ago.
Hello Andrew
Thank you, ***** ***** just what I need, also her solititor is doing a deed of trust.
There is no rush for the repayment I am only concerned that should she die the monies come back to me or my estate should I pop my clogs in the meantime
So I take it that if the form states the above this will that be correct
Regards
Anthony
Expert:  Aston Lawyer replied 1 year ago.
Hi Anthony,Thanks for your reply.You can indeed word the CH1 to say that the outstanding amount becomes payable in the event of her death. Please beware, however, that if god forbid, anything did happen to her, you won't necessarily get your money straight way- it would be up to her Executor to pay you, and if they didn't, you would have to go to Court to enforce the terms of the Charge! However, at least you would have the security of a Charge over her property, so you would get your money back at some point!!Good luck.Kind RegardsAl
Customer: replied 1 year ago.
Hi Andrew
Have taken a look at the CH1 but not too sure on a couple of the questions and it seems there is a need to fill in other forms along with it.. I little hear say also is that I might have to pay some kind of tax loaning this cash
Regards
Anthony
Customer: replied 1 year ago.
Is a promissary note any good?
Expert:  Aston Lawyer replied 1 year ago.
Hi Anthony,I do of course suggest that you speak to a local Solicitor to make sure you do get fully protected and register the CH1 correctly (you need to submit an AP1 also, which is the application form. Unless you are familiar with the Land Registry paperwork, it can be daunting. On the basis that we are talking £65,000, it would be worth your while!!Alternatively, what can happen is that you get agreement from your friend's Solicitor that he will register your CH1 at the same time as he registers your friend's ownership at the Land Registry.There would NOT be any tax for you to pay concerning the loan. Hope this helps.Kind RegardsAndrew
Customer: replied 1 year ago.
Good morning Andrew
I note your advice and thank you.
I have no worries that this money would come back to me in time and as her solicitor is doing a deed of trust could I not do a promissory note to go along with it
Regards
Anthony
Customer: replied 1 year ago.
forgot to mention.. her solicitor does not seem keen on doing a CH1 etc of my behalf, conflict of interest
Expert:  Aston Lawyer replied 1 year ago.
Hi Anthony,If you are confident of receiving the monies back, a promissory note is a quick and easy way of documenting the loan.I would of course advise the CH1, as a Solicitor, but it is obviously your choice as to how you proceed.Kind RegardsAl
Customer: replied 1 year ago.
Thank you and I understand
Expert:  Aston Lawyer replied 1 year ago.
Thanks Anthony.If I have assisted, I would be grateful if you could rate my answer.All the BestAl
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Customer: replied 1 year ago.
Yes thank you, ***** ***** £38 now taken?
Expert:  Aston Lawyer replied 1 year ago.
Hi,Thanks- yes, payment has been taken.Kind RegardsAl
Customer: replied 1 year ago.
Sorry to be a pain . Just checking that Its just a one off payment and no further payments will be taken. You will know lm sure how some internet sites work. Thank s again AJW
Expert:  Aston Lawyer replied 1 year ago.
Hi,Yes- only 1 payment will have been taken. However, if you have subscribed for a set period, you will need to check with customer services, if you now wish to cancel your subscription.Kind RegardsAl