<p>It seems like your BIL has always been helped throughout his life and always expected. I wouldn’t lend him any money if I were you. I think he will expect more help in the future.</p>
<p>If the place is expensive but not nice, then sell it and move to a place that is less expensive. If he doesn’t get his job contract, it would seem to me that he would have to do this anyways. Income opportunities may not be as good in cheaper places but he has a pretty good stake already. If there has been tremendous appreciation, now would be a good time to take it off the table. He will probably have to do this at some point in time as it doesn’t seem like he will be working that particular job forever.</p>
<p>A good first step to making your decision might be to offer to pay for a consultation for your BIL with a financial advisor. He and your H could go together so all involved really understand the big picture and evaluate BIL’s options. A current real estate appraisal is also in order.</p>
<p>^^That is an excellent idea, my3sons!</p>
<p>OK, so one thing we have not touched on is that maybe the OP can afford the loan. When the relative that’s asking knows you have money, it’s especially hard to say no and maintain the relationship.</p>
<p>Maybe the answer here is to cosign for the small loan and loan him $5K or so to pay the first year’s payments until he gets the place rented.</p>
<p>I’d also make sure he’s in touch with current rental prices, people are not getting the rent they were last year in many markets.</p>
<p>I’m also wondering if you can have him legally sign over that amount from his inheritance so it auto goes to you.</p>
<p>I have had several experiences with my Husbands huge immediate family. My H and I have done well, and his family looks to us to solve their money ploblems. In the past, we did make a number of “loans” to his siblings. They would always make the first payment, and then you would never see a dime from them. If you mentioned it, my MIL would jump all over us for even asking. We were accused of thinking we were better than everyone else. It caused a huge rift, and we no longer talk to several of the siblings who owe use money. None of his family members have ever been good and managing money or their lives. At this point, I would not help any of them, even if they were losing their house. It is not worth the stress or agrivation. It has even caused some hard feelings between my H and myself. Be prepared for this if you lend the BIL money. Have you considered only lending him the $20K he needs for the immediate problem? I would definately not lend him money for the renovations. It looks like he will not make the necessary changes in his life until he hits rock bottom. Maybe that needs to happen, and you need to let it happen.</p>
<p>How much will he inherit from his parents? While I don’t believe that you should lend him money, could he take a loan out on the basis of the inheritance? I believe that there are firms that will do that. If not, could he sign paperwork that you would lend him the money with signed paperwork that you receive the money from the money coming next year? If it could be worked out that the loan repayment come directly out from the inheritance, you could be protected.</p>
<p>BCEagle, just to be clear, the 2-year employment contract situation is DH’s, not the BIL’s. I am thinking that the home should be sold now.</p>
<p>my-3-sons, that is a great idea, and I will suggest it to DH. This will get us out of the “hot seat” of being the one to come up with the plan and impose on my BIL. And we are not really qualified to do this. </p>
<p>hmom5, We are much stronger financially than my BIL is, but does that mean that we are required to help out until we are in as dire straits as he is? I don’t know of a way to have him sign over part of his inheritance to us that would be any stronger than just having a legal agreement to repay any loan we may make.</p>
<p>kmkord, I see this coming, a rift or at least a deterioration of the relationship either because we help him and he resents us, or we don’t help him and he blames us, or we help him and resent him for not paying us back.</p>
<p>silverlady, the inheritance will be more than any amount we might lend him, but I imagine that by next year he will have run up other debts and will need it to pay those. I see us as always last in line behind many other creditors.</p>
<p>I am thinking of suggesting that (assuming DH’s employment is renewed) we lend the $20k+ he needs to pay the pressing obligation with a legal agreement charging interest, insist that he see a financial counsellor with us to work out a plan. I am sure that any objective person will believe that the real estate will have to be sold now. If someone else suggests it, then we won’t have to.</p>
<br>
<br>
<p>Perhaps a financial planning person will be able to prevent this from happening. This sounds like a situation where “cash only” should be the rule…and if that can’t happen, then the purchase can’t happen. </p>
<p>Good luck…if you decide to pay the “pressing bill”…I would still encourage you to pay it directly and NOT give the money to your BIL…who could then fritter it away any way he chooses. If he doesn’t want you to pay the debtor on his behalf, then in my opinion, he really doesn’t want your help. He just wants your money.</p>
<p>And to answer one of your questions…regardless of your financial status…I don’t care if you are billionaires…you are under NO OBLIGATION to bail out this BIL. NONE. He made the debts and HE should be working on a plan to remedy the situation.</p>
<p>Oh…and when you go to the financial person…make sure BIL brings his wife along too.</p>
<p>I work in a law firm and just this week something came across my desk about different lenders shutting down the HELOCs of excellent customers. People who had had those lines for years and had platinum credit, but were told that they couldn’t actually borrow on them right now because of circumstances at individual banks. Are you sure you actually can borrow?</p>
<p>Worriedmom, in the worst case scenario, you loan the money, don’t get paid back and things turn bad for your immediate family, what would the impact be on your own marriage? Would you be in danger of turning your resentment or anger onto your husband?</p>
<p>Oh no. I would not do it. The only way you can have a “good” relationship with the BIL is to hurt yourself. No one who really loves you should expect this. He is not a child, and now he will have to clean up his own mess. Make his own bed. Dig his own… If he were starving or homeless you would feed him and give him a room, but not a trip to Hawaii. </p>
<p>You will never have a good relationship if it is so imbalanced (only one side gives). To some people it is important to have the “close” relation with their relative, regardless of the abuse, but to me, I prefer not to be abused. If your husband’s parents think it is important to give BIL the money, let them do it. He is after all, their son. It is so easy to tell other people to be generous, without opening their own wallet.</p>
<p>Best of luck to you.</p>
<p>Banks don’t swoop…especially when they are up to their eyeballs in people who don’t pay their mortgage. No bank is going to come in blazing when you’ve missed one payment. The BIL is just trying to scare you to get your $$.</p>
<p>Look–it is not like your H has years to make back a bad $40K loan. His employment situation is not even settled for the next 2 years. He has his own family obligations that he is willing to ignore to make this loan…not just the kids’ college but your own retirement.</p>
<p>Time for you to stand up and just say no. You are protecting your own kids, and your own retirement. What happens to your BIL is of his own making.</p>
<p>Your H has been enabling your BIL for years, even to the tune of paying for an HYP semester. </p>
<p>Your BIL will just have to find other places to borrow money from–how about that son who has an HYP education?</p>
<br>
<br>
<p>I don’t have any idea what you’re talking about…but MOST pressing bills don’t suddenly need to be paid on a few weeks notice. When did BIL get an inkling that this was becoming a desperate situation, and what did he do to deal with it? It sounds like he waited until the 11th hour hoping for a rescue from the family.</p>
<p>I just reread this whole thread, and I don’t see anything in the OP’s information that indicates that her family really SHOULD be doing this loan…other than perhaps a feeling of “guilt” if they don’t. They have college bills looming in the future, a retirement account that has taken a hit (as have many) and the only way to fund this “loan” is by tapping into THEIR home equity, thus creating a debt on their home which is now debt free. I’m sorry…but I think BIL is taking advantage of his family (it sounds like this has happened before). BIL and his wife need to work on their spending habits, and figure out how they are going to pay their bills themselves. </p>
<p>I can’t imagine living “frugally” in a $2 million dollar home while amassing debt one can’t pay. Living frugally usually means living within or even below ones means. I don’t think this sounds like this is the case.</p>
<p>zoosermom, I have worried about whether the line of credit is actually available, because the bank we use is one of the weaker ones. When I look at the online banking screen with all our accounts, the line of credit is still there, and as far as I know I can transfer money out of it to checking with a few clicks. But who knows? My husband thought I was being ridiculous to worry that our HELOC might be frozen if we tried to use it, since it’s the only loan on our house and we have excellent credit. But these days banks do not want to lend money. … That’s a good question about the effect on our marriage of this situation going bad in some way. I am more worried about the effects if we do not help and things go sour for my BIL. DH will feel terrible and he might blame me. I realize, thinking about this, that money is one thing DH and I have never had conflict over. We are capable of fighting about very trivial matters, I have to admit, but we have always agreed about money and never disagreed before about any financial decision. We are in agreement in our basic attitudes, and have been fortunate enough to have a high enough income that we have not had to face hard decisions. So this is a completely new situation.</p>
<p>Worriedmom, please believe me when I say that I’m sorry that you are confronted with this dilemma. I always think it stinks when someone else’s screw-ups can disrupt your life. The most important thing is that you protect your marriage and your family’s best interests. If you can do those things, then help as much as your conscience and your finances permit. Just one thing, though, please get as much information as you possibly can. Sometimes people aren’t completely honest, and sometimes with all information in front of you the perfect course of action becomes clear. Insist, at least, in knowing what the circumstances are and don’t lend money without it. I wish you very good luck!</p>
<p>PS The HELOC freezes had nothing to do with individual customers, but partly with institutional decisions to get out of the HELOC business entirely and partly as a result of internal audits currently going on.</p>
<p>anothermom, your comments are very perceptive. To be frank, we have never been close to this brother and hardly ever see him or his family, even though we are not very far away. We do not have much in common, and there is something about him that has always bothered me. It’s as if he has never grown up, and he always expects that someone else will take care of him and his family. A couple of examples - whenever we have gone to a restaurant together, he always assumes that DH will pay, because he’s the older brother, I guess. He doesn’t even say thank you. Another thing that bothered me a great deal was that when it was time to send his youngest child to school, he spoke of asking for financial aid. This shocked me. This man went to a boarding school for HS and to an Ivy League college, paid for by his parents. Both DH and his brother were given enough money when they were starting out to make a down payment on a house, or start a business. My BIL was also given significant sums of money by his parents a number of times. With all these advantages, he still felt entitled to have his child’s private education paid for by others out of limited financial aid money that is really meant for disadvantaged children, while he is living in a very valuable home (they were not given financial aid, and the child goes to public school). This childishness is accompanied by a certain arrogance. He felt for many years that it was beneath him to take a job that was not his chosen one in the arts, and he has always felt that there was no acceptable place to live other than the (horribly expensive) city where he is. In his situation, I would do anything to earn extra money - clean houses, work as a waitress, etc. This kind of thing is not even on his radar screen.</p>
<p>ellenmenope, I wonder whether there have already been some missed mortgage payments? My BIL and his HYP son are estranged, and have no contact with one another. In any case, the HYP son went on to grad school and is still young now, in the early stages of his career, and in no position to come up with such a chunk of money. This is a wonderful young man, and I have no resentment about the HYP semester we paid. I’d forgotten it until this new situation came up. At that time, when we were younger, things looked very different than they do now, when we are facing the end of our working years.</p>
<p>zoosermom, I hope we can get accurate information out of him. I’m not sure how to get it otherwise - as a poster early in the thread said, I am not a bank! Thank you so much for your kind words.</p>
<p>No NO NO. If this was an issue of having money problems due to circumstances beyond his control, then okay. But don’t bailout someone who dug their own financial grave. Time to sell the house, sell anything else of value, declare bankruptcy.</p>
<p>The only thing I would do is make sure he isn’t starving. Other than that, too bad.</p>
<p>I don’t see the word “doormat” stamped on your forehead!</p>