Best way to approach this?

[Shadow2981]

Hey,

Ok, a family member has a loan they took out for a boat (I dont know figures, perhaps somewhere between £15k - £25k).

It is probably around 2 - 2.5 years old. As far as I am aware there have been no repayment problems to date, but his circumstances have just changed, he was made redundant, and the only trade he knows is all being replaced by machinery.

Issues at the marina where the boat is kept/he lives have basically left him no choice but to sell the boat - and as he needs a quick sale, he has to sell it at a loss to a trade buyer, who intends to re-sell, so the price will be quite low.

He is in the process of starting a new business, and doesnt want debts looming over him. He hasnt, as far as I am aware, struggled with the loan thus far - but doesnt want to first struggle before trying to get a reduced settlement.

He needs some of the money from the sale of the boat in order to live... like a deposit for a place to rent etc... but would be willing to pay a large chunk to as a reduced settlement. He doesnt want to just reduce the monthly payments by paying a large amount of it off if he doesnt have to, as he has no idea how well his business venture will do... so needs as little financial commitment as possible.!

Any ideas on the best approach to take with this?

I think the loan is un-secured - but could be wrong..

[Never-In-Doubt]

Re: Best way to approach this?

Thing is the lender is unlikely to do much, they will want full payment and if he pays less then the problem is they'll update the CRA's thus affecting his long-term plan of a clean credit file.

Catch22 - to get a deal you need to default with payments and get it sold to a DCA.

[Shadow2981]

Re: Best way to approach this?

Hmm... What would the possibility be of him being able to negotiate paying a lump sum now - and requesting a 1 year holiday on the remaining payments, to give him a year to determine how business is going? The lump sum will far exceed the payments missed in a year - the other alternative is to put the money in an account and just let the monthly payments be taken, but the temptation is always there during tough times if he has access :/

[Never-In-Doubt]

Re: Best way to approach this?

Hmm... What would the possibility be of him being able to negotiate paying a lump sum now - and requesting a 1 year holiday on the remaining payments, to give him a year to determine how business is going? The lump sum will far exceed the payments missed in a year - the other alternative is to put the money in an account and just let the monthly payments be taken, but the temptation is always there during tough times if he has access :/

Nope, unlikely mate as that'd be a breach of the terms. If he was going to do that why not pay a years instalments now and then worry about it after the first year?

They won't negotiate, why would they? Would you?

[Shadow2981]

Re: Best way to approach this?

Yeah, you have a point... Bugger!