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 Post subject: My BF keeps asking to borrow money from me
PostPosted: Tue Mar 26, 2013 10:01 am 

Joined: Tue Mar 12, 2013 12:44 pm
Posts: 19
I'm new to personal finance in general and recently relocated to a new city to be closer to my boyfriend, after a year and a half of dating. Anyway career wise it was a better move, better benefits, greater pay, greater autonomy over my work etc. However, I need some advice on what to do in regards to by BF who keeps borrowing money from me.

He's currently getting his own independent business off the ground - he owns a car lot, and also owns a couple properties that he's fixing up with intent to rent out. Last year, he was in a bind where he had most of his money tied up in vehicle purchases. I had some cash on hand, and offered the loan since I didn't need the money right away. I did everything legit - drafted a contract which he signed etc. He paid me back the money, although late, but since then keeps asking to borrow money from me. A couple hundred I can see, but its usually in the 3-4 K range - which considering I am still trying to build myself is alot of money for me.

Anyway, I guess I’m looking for general advice as I’m very confused as to how to proceed, first without ruining the relationship, but establishing some boundaries. I see now that because I provided a loan I have now opened the door for him to continue to ask. He was going through a tough time and I wanted to offer some temporary assistance, I didn’t see this as something that would continue. It’s not just that it continues, but it’s the fact that he asks me to borrow money after he has already made purchases, or blindsides me when we are out, and I’m not expecting it.

Also, because he was someone I was considering building a future with it also worries me about his ability to balance a budget. I think his mind is in the right place, he’s buying homes, and cars to sell for a profit to build his future, as opposed to material luxury things; however I don’t see myself funding all of his projects in the future, and while I can take care of myself, it would be nice to have a man who could also take care of me every once in a while (with his funds not mine). I had two conversations with him on this already 1. A few months ago when he invited me to a car auction and then asked me for 500$ while there 2. This morning, when I told him that I don’t want our relationship to turn into a business arrangement.

I’m staying with him until I get acclimated with the new city – I’ve been here a week, and he’s already borrowed 1500$, and he already owes me 3500 from December.

Please no judgment – just advice!


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 Post subject: Re: My BF keeps asking to borrow money from me
PostPosted: Tue Mar 26, 2013 10:58 am 

Joined: Mon Feb 04, 2008 7:35 am
Posts: 1148
Location: Maryland
You've been there a week and he owes you $5000? If you want to stick around, say no now and wait until you get the money back and then move into your own place. Or...just get your own place and part ways.

Now that you're closer, it's a lot easier for him to ask for money, and if you continue to give it to him, why should he stop asking?

I understand it's a difficult situation because you've already vested 1.5 years with him, but in the end, if you leave now, you have the rest of your life to find someone who is a little more financially stable and won't be such a user. Sorry to hear of your troubles in your new town.

Best of luck.


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 Post subject: Re: My BF keeps asking to borrow money from me
PostPosted: Tue Mar 26, 2013 1:10 pm 

Joined: Wed Nov 16, 2011 1:26 pm
Posts: 36
From my experience making a loan to a friend that was supposed to be short term (< 3 months) I made the mistake of not charging enough interest. The friend decided that paying me back in the originally determined time frame was not necessary. I got my money back six months late but got no interest. My friend still felt I was inconsiderate for pestering him about the borrowed money, and after I was repaid we did not remain in touch.

I do not know if you are charging interest, but if not then there is little if any driving factor for him to repay. Was there any penalty for him paying you late the last time he borrowed money? Charge him 20% APR with a minimum payment and high fees like any other consumer loan (unsecured debt) lender and the behavior may change. At a bare minimum charge him what his credit card company would.

I would ask if you are living in his apartment/house. If so and you are required to pay rent, then you can force the issue by making your rent a monthly installment on the loan with no intention of loaning him more. I do find it worrying that a year after getting a short term loan from you he has not built enough of an emergency fund to cover unexpected business costs. Obviously I do not have enough knowledge to judge why this is, but I would suggest that there be a focus that he maintain a minimum balance to cover 3-6 months of operating costs.

I hope you get things squared away and it works out.


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 Post subject: Re: My BF keeps asking to borrow money from me
PostPosted: Tue Mar 26, 2013 6:25 pm 

Joined: Tue Jun 12, 2012 4:34 pm
Posts: 502
This reminds me of that old Kenny Rogers song. "You've got to know when to hold 'em; know when to fold 'em; know when to walk away; know when to run..." From the information you provided (he was late repaying you previously; he's asked you for more money multiple times while still owing you a substantial amount), it seems as though this is a bad hand to bet your future on. If it were me, I'd fold on this one.

Good luck to you.


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 Post subject: Re: My BF keeps asking to borrow money from me
PostPosted: Tue Mar 26, 2013 6:41 pm 

Joined: Tue Mar 12, 2013 12:44 pm
Posts: 19
Thanks for the advice all. I am slowly coming to the same conclusion that it may be best to walk away. I wish I would have figured this out prior to moving, but its one of those things I couldn't really see or chose not to see until now.

At least the move was the right career choice so I'm not mired with regret....


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 Post subject: Re: My BF keeps asking to borrow money from me
PostPosted: Tue Mar 26, 2013 9:31 pm 

Joined: Tue Jun 30, 2009 9:44 pm
Posts: 293
Location: Atlanta, Georgia
Yep, I'm gonna agree with the others that I would NOT continue loaning your bf money. You already had an inkling of this when you said you wanted to avoid having your relationship turn into a business arrangement. I'm sure he has many good qualities and there is more than your relationship that this, but it would make me uncomfortable that he is in part using you as a financial crutch, especially since he paid the first loan back late, has asked for another loan before paying back an existing one he took from you, and manipulates the situation to put you on the spot for other loans. If his business venture is really solid, then he should be able to go to the bank/credit union and get a business loan. I really don't think it's fair of him to ask for so much assistance from you personally instead of exploring other options -- and if he's not qualified for those, then, in a way, it's even less fair for him to put you in this position. Good luck! (Also, no judgment here. I am the idiot/original poster of this thread viewtopic.php?f=2&t=55952 which I ought to update soon with the NOT GOOD ending.)


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 Post subject: Re: My BF keeps asking to borrow money from me
PostPosted: Wed Mar 27, 2013 1:45 pm 

Joined: Wed Mar 27, 2013 12:38 pm
Posts: 8
Location: Richmond, VA
I have to agree with the rest of the responders. I assume you are not charging him interest? What kind of return is he seeing in these ventures? Since you are the investor, are you going to see any of the profit?

I think that the silver lining in these situations is that at least you know now and not further down the road with even more commitment.

_________________
Blog: http://thriftgenuity.com
Twitter: http://twitter.com/thriftgenuity


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 Post subject: Re: My BF keeps asking to borrow money from me
PostPosted: Thu Mar 28, 2013 6:37 am 

Joined: Tue Mar 12, 2013 12:44 pm
Posts: 19
I wasn't charging him any interest. It was supposed to be a one time favor for someone I cared about but turned into something much more.

I wish I didn't put myself in this situation, but I also wish that he wouldn't have taken advantage and would have just paid the money back, so as not to place me in this situation. I have set an absolute drop-dead deadline for him for returning the money to me, but in all honesty I'm not sure he will. It won't end me financially, but it will end us romantically.

I'm not sure how much of a return he's making on the money I loaned him, and at the time I didn't intend to be an investor. Lesson learned - I will not make any more loans to anyone, and will do my best to nip this situation in the bud, so that it doesn't continue. It has just made me think a lot about whether or not we are financially/romatically compatible, and whether I'm being "used".


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 Post subject: Re: My BF keeps asking to borrow money from me
PostPosted: Fri Mar 29, 2013 12:18 pm 

Joined: Sat Oct 20, 2012 7:20 pm
Posts: 21
Are you paying rent?

If so, I'd deduct the amount you're supposed to pay from the amount he owes you.

If not, then you should be. You'd be guilty of taking advantage of him in this arena, and so he thinks it's OK to ask for a financial interest in his business.

But overall, yeah, sounds like he thinks he's "smarter than the average bear", and wants to get rich using Other People's Money. That's OK if the OPM comes from a legit source like a bank. Less OK if MY income is seen as OPM for his benefit.

;)

Good luck with this, and glad that the move was good professionally, if nothing else!


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 Post subject: Re: My BF keeps asking to borrow money from me
PostPosted: Fri Mar 29, 2013 3:08 pm 

Joined: Tue Mar 12, 2013 12:44 pm
Posts: 19
I'm not paying rent. Prior to me moving in we discussed how we would split the finances while I'm there, and he didn't want rent, but I buy all the groceries, the things for around the house, the pet food etc., so I'm not exactly living for free. I had also agreed to purchase a washer and dryer since he didn't have one - but obviously I won't be doing that, since he owes me a significant amount.

I did ask all of those questions prior to moving in - so it wasn't a situation where I'm free-loading. I started looking for an apartment today. I think it's best we just live separately at the very least, because I've actually ended up paying more than what I would have - had I chosen to live on my own. Also, I don't believe it's a fair comparison as he has owed me money since prior to me moving in (I've only been here 10 days), and I've offered to cover and have been covering the household expenses.


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 Post subject: Re: My BF keeps asking to borrow money from me
PostPosted: Tue Apr 02, 2013 1:06 pm 

Joined: Fri May 04, 2012 2:23 pm
Posts: 810
If your BF is taking advantage of you, come over to this BF. This BF would like to borrow some money as well.

Sincerely,
BF.

PS, it is awfully kind of you to give monetary loans to your dog. ;)

_________________
Bichon Frise

"If you only have 1 year to live, move to Penn...as it will seem like an eternity."


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 Post subject: Re: My BF keeps asking to borrow money from me
PostPosted: Wed Apr 03, 2013 11:00 am 

Joined: Tue Mar 12, 2013 12:44 pm
Posts: 19
Update:

I just wanted to provide an update on what happened. I decided to look for an apartment and live on my own. I told my BF last weekend, and asked him to go with me to view the place that I was really considering living. I think it woke him up a bit, and I received a check for the whole amount he owed me that same day! He asked me if I didn’t want to stay living with him, and quoted back some of the things I told him about not wanting the relationship to turn into a business arrangement so it appears he CAN listen.

We had eventually planned on potentially purchasing a home together in a year or so, and had played around with the idea of me staying with him – paying for the groceries, our dog, dinners out etc, and he would continue to pay his mortgage/utilities, to save $ for our home purchase. But hadn’t really made up our minds, so my backup plan was always to get situated in the city and then look for a place to live.

He doesn’t want me to sign the lease and move out, but I’m also leery that staying with him will just provide him with an opportunity to “take-advantage” and then I won’t end up saving anything anyway, and don’t have a place of my own to go. So long story short is I got my money back and found a place to live all in the same day! I haven’t broken up with him, but will not provide any more loans, and will also continue to monitor our compatibility going forward. Thanks for all your advice and humor 


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 Post subject: Re: My BF keeps asking to borrow money from me
PostPosted: Wed Apr 03, 2013 12:22 pm 

Joined: Mon Feb 04, 2008 7:35 am
Posts: 1148
Location: Maryland
Now this is an update I am happy to read about.

Good for you for sticking to your guns AND getting your money back. You've got one over me! I was thinking that you were going to agree to stay with him since he paid you back. I'm SO proud of you. Boop boop! *doing the happy dance*

Make sure you continue saving money for a future home purchase, whether it is for yourself alone or you and him. Again, way to stand up for yourself!


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 Post subject: Re: My BF keeps asking to borrow money from me
PostPosted: Wed Apr 03, 2013 12:49 pm 

Joined: Tue Jun 12, 2012 4:34 pm
Posts: 502
newb wrote:
I decided to look for an apartment and live on my own. I told my BF last weekend, and asked him to go with me to view the place that I was really considering living. I think it woke him up a bit, and I received a check for the whole amount he owed me that same day!


So he actually had the money available to pay you back, but didn't think it was important to do so until you decided to move out? Huge red flag. Please don't get me wrong; I'm really glad you were able to get your money back. I think, though, the manner in which it happened sheds a lot of light onto his priorities.

newb wrote:
So long story short is I got my money back and found a place to live all in the same day! I haven’t broken up with him, but will not provide any more loans, and will also continue to monitor our compatibility going forward.


I'm glad you'll be able to move forward with your money, in your own place, and with an eye on whether you two are compatible for the long term. :clap:


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 Post subject: Re: My BF keeps asking to borrow money from me
PostPosted: Thu Apr 04, 2013 6:53 am 

Joined: Mon Apr 25, 2011 7:37 am
Posts: 446
Glad to hear the good news. Moving in together before making that big commitment changes the relationship to be a lot more serious and entwined than if you are living separately. That way choosing to be together is a choice, versus something dictated by the circumstances.

One time my husband wanted us to use our emergency fund for a iffy business venture. And I said "honey I'm your wife, I am not your business investor!" If he wants to borrow money, he needs to get it from someone who does that for a living (investor or bank).

Personally if I was living with someone either renting and especially as mortgage, I would prefer to pay a straight amount as rent, than in trade as groceries, etc. That way if things went south the other person couldn't accuse me of not contributing to rent, not having ownership, etc. I've seen enough People's Courts! :wink:


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