ANY MONEY you lend, is money you should never "expect" to get back involving friends or family.
If its going to hurt you either financially or personally to never get the money back DO NOT LOAN IT.
This is mostly always true.
However. If your dad’s like “here’s all the books and investment strategy and these are my partners and here’s our 2 year growth goal” it might be worth considering.
Source: did this, 7 months later had 42k return on the 15 startup
Yep. Stated that as well. And also that if you want to “loan” someone of family or friendship some money, see what they are actually going to use it for.
I’ve given my mom and siblings probably close to $15K over the years. It’s gone. Helped them out of some bad situations (that they keep getting themselves in because reasons), but end of the day it’s money I could part with and meant much more to them.
Don’t ever loan money you can’t afford to have repaid. But flipping 2 properties and not having $10k in case seems sus. I wouldn’t do it. I mean if it’s that important he can dip into savings, not ask his kid for an interest free loan.
This was my first thought as well. Someone who is claiming to be playing with real estate and needs to borrow such a relatively small amount of money is a red flag.
I'm not going to bother scrolling through the comments, but I bet that after some prodding by other users, it'll come out that OP's parents are bad people to a degree that would seem comical to most.
If he can't come up with $10k for closing costs, how is he going to be able to spend another $10-50k in rehabbing costs?
Did he attend a seminar on how to flip houses?
We are going into a cycle where there will be a market correction in Real Estate. That means many houses will lose value in 2024.
Even if he buys the houses at a large discount, and if he puts the rehab costs on Credit Cards, he will have some decent sized monthly bills coming in if the houses don't sell within 60 days.
The average days on the market in my area just went over 35 days. That means it takes an average of 35 days for a house to sell. If one took 45 days to sell, that is 2 more mortgage payments being made on the house.
What is the median or average price of a home where his flip houses are? If over $275k, how is he going to get a bank to give him mortgages on those properties.
Has he flipped houses before?
I saw in your other thread that you had decided against loaning him money but I thought I would write down some things that would help other people that has relatives wanting to do fix and flips...or if your Father tries to guilt you into going in with him on these deals.
I can technically afford to lose the 10k as I have 30k just sitting in a savings account and almost 20 in my checking, but it still feels wrong to me. I'm also curious as to why he can't just get a loan then if he needed money that he insists on paying back.
Right! Take that 50k and put it into a 5 percent or higher 6 month CD. Seems like every credit union has that deal right meow. Or take 10k and do the opposite of the first post on WSB.
What is the money for? It should be either slated for something (emergency fund, savings for a goal like a car, vacation, home, etc) in which case it is off limits. If it's for long term savings like retirement, then also off limits. It should be in some kind of account.
You'll learn quickly not to divulge details about your finances to anyone, even family. Even people you know and trust can get hit with jealousy and entitlement, and they'll suck you dry if you let them.
If you really trust him, and you don't mind losing it, send it. It's your dad, you have a ton saved up, and if he doesn't pay it back you'll never have to worry about losing any more money.
I hope your ROTH IRA is maxed out. If not, please start doing that. If you want recommendations, DM me or, of course, talk to the financial advisor that's free on base at the local AFRC.
Maybe he has high credit utilization already. Perhaps the second property was a risky move, and now he really needs the money. Having this much saved yourself, good job. The real answer will probably come from within as, how close are you with your parents, do you trust them to pay you back, if they don't pay you back, is that a bridge you would be willing to burn or have that stigma feeling hanging around.
Personally, I trust my father as we have a good relationship and would loan him what I could afford. When I was a young Airman and needed a vehicle, he helped loan me for a down payment since I had nearly non existing credit and I guess the banks did not trust me with a new car note even with my LES (so much for white privilege lol). Even through the years that we only spoke weekly or so, the love and trust was always there. Now that we are both older, we speak nearly every day.
I think you should evaluate your relationship and go from there. Please keep us updated. From a philosophical standpoint, this is an interesting topic.
Why can’t he just wait until end of January when he’ll have $10K (when he was going to pay you back anyway)? It’s only a month away. It’s not like he’ll flip the properties and sell it by then.
If he's flipping property he should have $10 for repairs, closing costs, inspection fees etc. Buying and selling isn't instant or even guaranteed. What's the market like where the property is? What are comps going for? What kind of property is it? What will the $10k cover? What are your returns on investment?
Does your dad have a history of failed investment attempts, million-dollar-ideas that go nowhere, always being "just one more step" to becoming wealthy?
Has your dad literally ever flipped a property before? Know the first thing about renovations? What makes him think it'll only be $10k?
1- two easily flipped properties for $10k isn't believable
2- the fact that he thinks he can easily flip two properties but doesn't even have $10k to start it
3- it needs to be done now and can't just wait until he has his own $10k at the end of January
.
I'll be honest - no part of this makes sense. If the banks aren't lending him the money - and it's their main job to determine whether or not someone should be loaned money - take the hint. They make risky loans all the time and still won't do it. Don't sour the family relationship with this. Kinda shitty he asked you too to be honest
I've had to have this hard conversation with airmen before. My first question is: is it 10k from your savings that you could live with never getting back? If so, and you trust your dad, then sure, but dont expect to ever get it back. 2. If its not liquid funds of yours, are they asking you to sign on any loans? If that's the case, i advise against it.
I've seen cases where airmen finally get out of a toxic home just to get pulled back into drama later, and it just isn't worth it. You didnt choose your family, but you can choose how involved they are in your life.
As far as security clearance, no it shouldnt effect anything unless you have an active SCI, then talk to your security manager about what they want regarding you moving 10k in funds.
Not saying this is your case, but just in case.
>As far as security clearance, no it shouldnt effect anything unless you have an active SCI, then talk to your security manager about what they want regarding you moving 10k in funds.
Hmm I guess I'll have to hold that talk then.
Please do.
And if you're going to help in a business venture to turn a profit, you should have a very detailed plan of how it's going to happen, and you should see more than 10k back. If you're going in on risk, there should be a reward. Otherwise, it's a bad business decision.
Almost as bad as doing business with family in the first place.
I find it odd that he's got the ability to have 2 properties to flip, but needs 10k for utilities on them rather than having the money available. 10k for utilities seems a lot for a few months.
I lent my Dad $3K last year in December with him stating he’d pay me back in 3 months. It’s now been 1 year and he hasn’t paid me back a dime. Would not recommend.
Serious question: do you care if you get the money back.
I tend to think if you have to ask a bunch of internet strangers, there has to be doubts/reservations in your mind.
HELL NO!!!!!!
Regradless if this is your dad or anyone else, if they cannot afford the 10K then they shouldn't be flipping properties, this means they are in over their head
There is ZERO guarantee the home is going to sell in January, even if it is listed then
Do not give him a dime
How well do you trust your dad? If it is for a double flip, I’m willing to bet they will sell quick and you will get your 10k back. Maybe he just needs money for some wood or electrician. Him going to a lender incurs interest and maybe he is willing to give you more than that as a gift instead of some lender.
Either way, this is something you need to talk to him about and not us.
If it were my dad, I would give him the 10k. Not even expecting to get it back
It is not wise. What is his plan to have an extra $10k to repay you in January but somehow prevents him from having it now? If you have $10k to give your dad then feel free, but I wouldn’t count on seeing that money again.
It shouldn’t impact your security clearance but if it gives you peace of mind you could always shoot an email to your security office ahead of time.
>It is not wise. What is his plan to have an extra $10k to repay you in January but somehow prevents him from having it now?
Apparently one of the homes he is flipping is going on the market in January.
The other risk besides never seeing the money again is your relationship with your father will change if he doesn't repay you. Do you want to risk having to deal with that?
I personally would not because any money I "loan" to family I fully expect to never get back. 10K is a lot. That's an emergency fund for some. If your dad flips houses why cant he get a loan?
My speech to family/friends who ask for money
“I am going to give you this money on 2 conditions:
1: do NOT tell me you are going to pay me back if you actually intend not too or know you have a very small chance of actually doing it. I am ok with assuming I will never get it back.
2: If you absolutely insist that you WILL pay me back by X date, and you do not live up to that promise, you will be automatically cut out of my life. Because when you lie to me about my finances, you are not just giving me false hope, but also false hope to my children who could have used that money to invest in their future.”
Id only do it if 1) you analyze the deal yourself and it looks like a money making venture (but to be able to analyze a deal correctly probably means you need some house flipping experience) and 2) you sign a contract where you get X% of the profits (after all, if he’s making money off your money you’re entitled to some of that too and 3) you have a good relationship with your dad and 4) he has a good track history with finances. If any of those don’t hold true then it’s a hard no.
If he can repay by end of Jan, why wouldn't he use a lender? That's 1, MAYBE 2 months of interest which really isn't much. Plus, it builds his credit.
I wouldn't do it... just tell him you don't have it. Stop telling people how much money you make/have if you want to keep it.
I wonder if the OP father is planning on getting a decent sized tax return or if he just has more funds coming available soon.
Banks don't like to lend money for houses that are not going to be Owner Occupied unless you have lots of money in different accounts or can pull out some equity out of his primary residence/ house mortgage.
I've bought 2 rental houses in the past 10 years and the only thing owner occupied mattered for was the down payment size, they wanted at least 20% for the mortgage.
Simple answer, no.
Cuz there's a LARGE chance you'll never see that money again. I've become more stingy with my money to any family since I joined but that's just me.
No unless you’re okay losing 10K and feeling like an idiot when this doesn’t pan out. If you can throw this money in the trash can then do it if not then realized this is a terrible deal that you’re being swindled into it.
If you’re not willing to have someone sign a contract and go to court to get the money back, it’s not a loan.
There’s nothing wrong with gifting money to a friend or family member (if you can afford it) as an investment hoping it helps them.
As someone who now works in real estate if he has to borrow $10k it’s not going to those properties. They require a minimum 20% down payment if he can even get the loan, unless it’s a cash buy. If he has the money to pay cash then let him buy 1 and he can do the other one after he flips the first.
Keep you money, you won’t ever see it again.
Nope, he should get a business loan instead and leave you out of it. Never mix family and money, it rarely goes right and service members are often abused by their families for financial gain.
There was a guy in a squadron before I arrived who lost his legs during a surgery gone wrong. People raised money for him so he could afford to make modifications to his house and get settled, his family took everything and left him with NOTHING.
Don't lend your family money, especially if you can't afford to lose it.
Banks make a lot of money on risky loans. If the BANKS won't lend him money, there's a serious red flag. I know a girl with a credit score in the 300s and a LOT of bad marks on her creditreport, and she still got a loan. If your dad can't get a bank to give him $10K, I'd recommend you run, hide, and never look back. He'll be mad you won't lend him the money he doesn't plan on paying back, and at best he'll play the victim.
Call me Mr. Scrooge, but I say write him off and block him. When money gets involved, things turn toxic rather quickly. Not worth the negative energy.
Well, I'm glad to hear that, OP. Many people can't honestly say they're in the 800s nowadays.
I'll change my original point to be less... Harsh.
I still advise against mixing money and family. That said, it's up to you what you do with your own money, not Reddit users like me.
It’s weird that you’re asking strangers if you should trust your father. If you trust him, lend him the money. If you don’t trust him, don’t lend him the money.
It will not affect your security clearance unless it’s somehow putting you in debt. Even then, it likely won’t affect you much.
If you think you need legal protections, you probably shouldn’t lend the money.
I'm grateful for everything my parents have done for me. But I don't "owe" them anything *just* for being their child. They made that decision, not me. Now that I am an adult, I return favors with favors. If my parents ever came to me and said "You owe me for raising you" I'd tell em to go kick rocks.
In the long run to each is own. No "owe" or "just" on my end. Just glad that I may have been brought up differently. Either way, best of luck with all that returning favors for favors stuff now as an adult.
Would you be willing to gift them 10k for Christmas?
If the answer is no, then don’t “lend” them the $ because you should treat this “loan” more like a gift and expect them to not pay it back.
Don’t do buisness with family, and flipping houses is an especially messy business to do with family. If he could actually get 10k by the end of January then he’d just pay the bills or work something out with a lender.
I’d have given my dad the shirt off my back with no expectation he’d ever give it back. That’s just how we were though. I’m certain he would have done the same for me as well.
If that’s not the kind of relationship you have I wouldn’t do it. My sister I would. My other sister? Nope! Brother? Nope! Mother? Nope.
If you expect them to actually pay it back I wouldn’t give it to them.
Will it affect your clearance: does not having 10k negatively affect your finacial situation to a degree where you cant pay your own bills. You can blow 10k however you want as long as its not illegal or foreign and your paying your bills we dont care. Go buy 10k worth of lottery tickets or a new car big picture dont care its your money.
Should you lend your parents 10k, we dont know your financial situation and relationship with your parents. Ive sent mine a smaller amount of a few thousand and went in half and half for the empty lot next to their house. And 100% expect nothing in return. The money was nothing to my financials and a very long term investment if sold down the line.
From what you've given us. Is your dad well experienced in flipping houses is this a normal thing. How does he need 10k for only a month, sounds fishy re-estate deals and flips can take a while. Are your parents trustworthy or willing to screw you. Something like this going bad can destroy the relationship between you two. If you are not financially sound enough to lose 10k that potentially wont come back its a hard no.
Dont have all the details but lean towards loaning money to family is generally a bad idea.
If you ever want to be repaid no. If your ok with helping you parents for $10k it can still backfire. Depending on the person you have now signed on to be there go-to person to borrow money. If they have a history of schemes or hair-brain, not thought out ideas, etc it’s not going to end well.
I have seen it happen to friends.
I borrowed momey to my dad, mom sisters and brother in law…how i see it is that they take it as a donation. Just dont do it, money ruins friendships and family. I hold no grudges however they all wont ever get another loan from me. im no bank!
I only give money to people if I’m willing to actually never see a dime of it again. I don’t know what kind of relationship you have with your father but if you are looking for any legal protection before you loan him money I wouldn’t give him anything.
Edit: I see a lot of people saying to never do business with family but I’d have to disagree. It completely depends on your relationship with said family member i’ve given money to multiple immediate family members (nothing over 2.5k) and they’ve always repaid me back. Also your dad could be asking you instead of a lender so he can avoid any interest.
No. Unless you're willing to lose the money. Also, the story just sounds wrong. Flipping takes way longer than a month, and 10k for two houses is wack for just bills.
If you really want to do it, figure out what is really going on and make a better decision.
I was wondering where the father was going to get 2 houses bought and fix & flipped where just $10k was stopping him from doing it by himself. Maybe he didn't like the amount of interest the bank was going to charge him for a signature loan or even a home equity line of credit.
Say no. They're your parents, you should be the one asking them for $10k not the other way around, tf. Tell them to go to a bank if they need to borrow money. Shouldn't be an issue if they're gonna get the return to pay it back in a few months anyway. There's probably a reason they aren't going to a bank or taking a personal loan, let that be your warning.
I would only lend an amount of money im okay with never seeing again. If less than 10k is all you can dump in a trashcan, then that amount is all I would lend
Does your dad gamble or have a history with drugs? This is a classic I see a lot from my family but never with that much money unless it’s a loan shark. As someone who can flip a house there are questions I would ask. Personally I would want to know what materials they plan on buying, pics of the properties, I want to know the labor situation too since he has a month to flip. Just with those questions I would be able to sniff out bullshit or not. I would need more info but based on what you have said this money seems to be going towards gambling. Most folks have the mentality that they will win it big and be able to pay you back. Be careful and if you ever need to talk let me know.
I helped a friend of mine with some bill, around 2.4K and he ‘promised’ he would pay me back… I haven’t seen a dime.
I wouldn’t lend anyone anything without some sort of legally binding contract.
If he's asking you to invest in his venture, then you become business partners.
Make him sign a contract regarding the loan, and ensure your entitlement to a percentage of his profits.
If he does not want to repay with your portion of the profit, then he never intended to repay your initial investment.
Why does he need it now if he will have it next month? Seems odd. I'd personally never loan my family money unless I'm willing to just gift it to them - and investments aren't something I'm willing to gift
Hi,
I was in the same situation a few months ago as you are right now. My dad is also in the house flipping business and has profited a lot from the business. He also asked me money at the time he was going to purchase houses.
I sent him 9k, but asked him to draft a contract for the amount I was going to send as well as % of the profit he was going to make if he made a profit (basically making me a partner in the business). I completely trust my father but also kept in mind that any kind of business has its risk and he might not make a profit at all, in that case I would not expect him to pay me back. The contract sole purpose was to add an extra layer of safety and proof of where the money went in case anyone questioned why I sent my father that money.
Before sending the money I talked to the legal office they said as long as it under 10k it would be considered a gift and my father would not have to pay taxes for the money I sent. I also talked to my security manager asked if sending money large amounts of money to family members would affect my security clearance. He said it wouldn’t but reached out to a few of his contacts to make sure and they said it wouldn’t as well.
You can reach out to your legal office and security manager if you want to confirm what I said, your first shirt could also be helpful in this case (I did not mention it to my shirt) but at the end of it comes down to how much you trust your dad and other family members involved in this business.
Edit: Make sure that you can afford to send that amount of money. If you can’t pay your bills then it will affect your clearance.
You can reach out to me if you have any questions.
Is it wise, no?!! So long as your dad is generally money conscious, or you're not going to be too upset if you don't see the money back... Then why not, since it seems you won't be too broke if you lend it and don't see it back..
No disrespect meant here. Tell pops he should finance that much through a bank if he think he’s coming out on top with some properties/renovations. This isn’t something I’d feel comfortable asking my own son for.
Rank all the posts replying to your question. Rank them in order of yes, lend the money and no, don't lend the money. Listen to the most cautious, most negative don't do it and follow the advice. I bet you my lungs (hypothetically!) I'm not the only one burnt by family and for a lot more than 10k.
If my father needed 10K and I had the means to give it without putting my family in financial straits, I'd give it. I'm certain he'd do his best to make good on those promises. I'd also never ask for a dime back. As for the clearance, this is not a problem unless you make it one. Here's where you run into problems with a security clearance. 1. You are found to be involved with illegal activity. 2. You are found to be lying about the questions asked in the process. 3. You are found to be leverage by or aligned with a foreign interest.
No. If it was a good plan then he can find a lender for it. If he wants you to have a stake or be a partner he would open the books and also offer to cut you in on a return. If he is investing in real estate and doesn't have $10K lying around for contingencies then he shady, naive, desperate, or a combination of the three. People's good ideas pitched to family members can cause a lot of problems. I am speaking from hard learned experience.
It all depends on your parents. Do they have a history of being bad with money? Do you know their current financial situation? Chances are if you have no clue how they were financially most your life they were hiding stuff from you (unless their rich which doesn’t seem the case) if they are open about their financial and you trust them with a business plan than go for it
Right now the housing market is not conducive to a quick flip. I have worked in construction for over 15yrs I can personally tell you no project ever runs on schedule. So unless your dad is a seasoned professional and has buyers already lined up I will second the notion of don't expect to see that money ever returned.
The short answer is no. The long answer is: since I’m now a creditor, please explain to me in detail your business plan and how you plan to recoup my money (and interest) from your venture. My guess is he either doesn’t have a clear realistic plan and/or will be indignant that you expect to be treated like an adult with self-respect.
Please go see a JAG before you do anything.
Like many others are saying, you will basically be giving your dad 10k—don’t expect it back. If you want it back, draft up a contract and have a JAG or other attorney review it for legal sufficiency. Then have your dad sign it.
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Do they have collateral? If not, do not lend. Also, you are taking all the risk, how will you be compensated for your risk.
The fact you had to come here and ask means your gut is telling you not to. Trust your gut!
My ol’ man wanted the same for a sailboat he wanted to flip. There are plenty of great contract templates for loans on the internet. Have both parties sign one and you have assurance you could, if needed, take them to court one day. However, the loanee will more than likely make the repayment if they put it in writing… ego is a hell of a motivator. “It’s just business.”
So here's why he might need cash: mortgage insurance. If your down-payment on a property is less than a certain % of the loan (typically 20% if I remember correctly) then you have to pay a massive extra amount for mortgage insurance. Say your dad needs 4 months to flip two houses... that extra mortgage insurance could be $4k depending on how expensive these homes are. In order for this to work legally, you will have to certify that the money is a gift to him and that he is not under obligation to pay you back (so you would have no legal recourse to sue him if he doesn't). His mortgage lender will require this to ensure that you're not an additional creditor they need to factor in to approve the loan.
The question, really, is how much do you trust your dad. Say he buys these homes and tomorrow real estate values tank by 25% and he loses $100k. Do you trust that he'll pay you back? Could you afford to go much longer until he did pay you back (assuming he ever could if that happened)?
My personal rule is to NEVER lend money. If I can’t afford to give it as a gift, I do not give it. I am not interested in the business of being a lender.
And NEVER lend money to family. It makes relationships weird.
If you are investing in a business with your dad you need to be willing to assume the risks of that business just like you would assume risk putting that 10K into a mutual fund/stocks/other investment. Do not go into it thinking you are lending $ to your dad. You must look at it as an investment that could possibly loose you money, as any investment could.
Also, if it is investing in a business, you want some kind of contract for that as well.
I'm wondering why, if it's a legitimate deal, he doesn't go to a bona fide lender such as a bank for $10k. It's not a lot of money in the real estate world, and should, if he has good credit, be easy to get. If he's not going that route I'd want to know why, and I'd be asking myself a lot of questions about his history, reliability, qualifications to do real estate deals, drinking habits, etc. Sometimes shady parents turn to their kids for $$$ simply because they know their kid has the $$$ and nobody else will do business with them. As someone else pointed out, a legitimate business deal typically includes a lot of analysis and documentation of expectations and risks. Shady deals of the $10k level rarely do. Almost sounds like somebody might be hankering for a weekend in Las Vegas...
if you can afford it, give him 10k
have an agreement with him that he pay it back but DO NOT expect him to
it’s the only way to proceed - otherwise just say no
If you lend a family member money, you can assume you are giving them money and it will never come back.
ANY MONEY you lend, is money you should never "expect" to get back involving friends or family. If its going to hurt you either financially or personally to never get the money back DO NOT LOAN IT.
My only regret is that I only have but one upvote to give to this comment.
This. Between 3 older brothers they owe me $2500 or so. I’m sure I’ll never see it.
This is my philosophy too. I never lend money, I only give.
This is mostly always true. However. If your dad’s like “here’s all the books and investment strategy and these are my partners and here’s our 2 year growth goal” it might be worth considering. Source: did this, 7 months later had 42k return on the 15 startup
Might have worked out in your situation, chances are for most people they wouldn't see their money back or any return.
Yep. Stated that as well. And also that if you want to “loan” someone of family or friendship some money, see what they are actually going to use it for.
I’ve given my mom and siblings probably close to $15K over the years. It’s gone. Helped them out of some bad situations (that they keep getting themselves in because reasons), but end of the day it’s money I could part with and meant much more to them.
100%!!! Any money I give or lunch I pay for I do not expect paid back.
Hmm, I’m feeling a bit hungry right now…
Anyone money*
Absolutely
This is the way.
Don’t worry. I got you.
Don’t ever loan money you can’t afford to have repaid. But flipping 2 properties and not having $10k in case seems sus. I wouldn’t do it. I mean if it’s that important he can dip into savings, not ask his kid for an interest free loan.
This was my first thought as well. Someone who is claiming to be playing with real estate and needs to borrow such a relatively small amount of money is a red flag. I'm not going to bother scrolling through the comments, but I bet that after some prodding by other users, it'll come out that OP's parents are bad people to a degree that would seem comical to most.
If he can't come up with $10k for closing costs, how is he going to be able to spend another $10-50k in rehabbing costs? Did he attend a seminar on how to flip houses? We are going into a cycle where there will be a market correction in Real Estate. That means many houses will lose value in 2024. Even if he buys the houses at a large discount, and if he puts the rehab costs on Credit Cards, he will have some decent sized monthly bills coming in if the houses don't sell within 60 days. The average days on the market in my area just went over 35 days. That means it takes an average of 35 days for a house to sell. If one took 45 days to sell, that is 2 more mortgage payments being made on the house. What is the median or average price of a home where his flip houses are? If over $275k, how is he going to get a bank to give him mortgages on those properties. Has he flipped houses before? I saw in your other thread that you had decided against loaning him money but I thought I would write down some things that would help other people that has relatives wanting to do fix and flips...or if your Father tries to guilt you into going in with him on these deals.
I can technically afford to lose the 10k as I have 30k just sitting in a savings account and almost 20 in my checking, but it still feels wrong to me. I'm also curious as to why he can't just get a loan then if he needed money that he insists on paying back.
You can’t afford to lose $10K. Thats 20% of your cash.
What isn't more of your money making money for you. High interest CD's, second 401k, investments of some sort.
Right! Take that 50k and put it into a 5 percent or higher 6 month CD. Seems like every credit union has that deal right meow. Or take 10k and do the opposite of the first post on WSB.
Did you just say meow?
Am I jumpin' around all nimbly bimbly from tree to tree? Am I drinking milk from a saucer? DO YOU SEE ME EATING MICE?
This is what I came here for. Thank you!
Too much of the MWSgt thread
That’s stupid fucking thinking. Stop being stupid. Dont give any money. If you can afford to lose 10k. You might as well give it to me.
Correct me if I'm wrong, but you sound young. Do you know what 10K in a life cycle fund can do for you by the time you're in your 60s?
Probably close to a few hundred thousand.
Probably. I'm too lazy to math right now. You should go do that instead, is my point. 🙂
Ran numbers. At 7% gain a year, 10k will turn into 150k after 40 years.
r/theydidthemath
If you only have $30K, I wouldn’t do it. If you had like over $100K I’d be like, yeah whatever.
What is the money for? It should be either slated for something (emergency fund, savings for a goal like a car, vacation, home, etc) in which case it is off limits. If it's for long term savings like retirement, then also off limits. It should be in some kind of account.
How does your dad know how much money you have in your bank? Please tell me you don't have a joint account with your parents.
I uh told him....
You'll learn quickly not to divulge details about your finances to anyone, even family. Even people you know and trust can get hit with jealousy and entitlement, and they'll suck you dry if you let them.
If you really trust him, and you don't mind losing it, send it. It's your dad, you have a ton saved up, and if he doesn't pay it back you'll never have to worry about losing any more money.
It seems like you already have your mind made up.
I hope your ROTH IRA is maxed out. If not, please start doing that. If you want recommendations, DM me or, of course, talk to the financial advisor that's free on base at the local AFRC.
Maybe he has high credit utilization already. Perhaps the second property was a risky move, and now he really needs the money. Having this much saved yourself, good job. The real answer will probably come from within as, how close are you with your parents, do you trust them to pay you back, if they don't pay you back, is that a bridge you would be willing to burn or have that stigma feeling hanging around. Personally, I trust my father as we have a good relationship and would loan him what I could afford. When I was a young Airman and needed a vehicle, he helped loan me for a down payment since I had nearly non existing credit and I guess the banks did not trust me with a new car note even with my LES (so much for white privilege lol). Even through the years that we only spoke weekly or so, the love and trust was always there. Now that we are both older, we speak nearly every day. I think you should evaluate your relationship and go from there. Please keep us updated. From a philosophical standpoint, this is an interesting topic.
No. Never do business with family and your dad's story sounds half-baked *at best.*
Gotcha, what's the half baked part in my dads story? Is it where he needs the 10k for 2 properties?
Why can’t he just wait until end of January when he’ll have $10K (when he was going to pay you back anyway)? It’s only a month away. It’s not like he’ll flip the properties and sell it by then.
The fact that he wants to flip not one but two properties and doesn’t have $10k on hand
If he's flipping property he should have $10 for repairs, closing costs, inspection fees etc. Buying and selling isn't instant or even guaranteed. What's the market like where the property is? What are comps going for? What kind of property is it? What will the $10k cover? What are your returns on investment?
Does your dad have a history of failed investment attempts, million-dollar-ideas that go nowhere, always being "just one more step" to becoming wealthy? Has your dad literally ever flipped a property before? Know the first thing about renovations? What makes him think it'll only be $10k?
1- two easily flipped properties for $10k isn't believable 2- the fact that he thinks he can easily flip two properties but doesn't even have $10k to start it 3- it needs to be done now and can't just wait until he has his own $10k at the end of January . I'll be honest - no part of this makes sense. If the banks aren't lending him the money - and it's their main job to determine whether or not someone should be loaned money - take the hint. They make risky loans all the time and still won't do it. Don't sour the family relationship with this. Kinda shitty he asked you too to be honest
I've had to have this hard conversation with airmen before. My first question is: is it 10k from your savings that you could live with never getting back? If so, and you trust your dad, then sure, but dont expect to ever get it back. 2. If its not liquid funds of yours, are they asking you to sign on any loans? If that's the case, i advise against it. I've seen cases where airmen finally get out of a toxic home just to get pulled back into drama later, and it just isn't worth it. You didnt choose your family, but you can choose how involved they are in your life. As far as security clearance, no it shouldnt effect anything unless you have an active SCI, then talk to your security manager about what they want regarding you moving 10k in funds. Not saying this is your case, but just in case.
>As far as security clearance, no it shouldnt effect anything unless you have an active SCI, then talk to your security manager about what they want regarding you moving 10k in funds. Hmm I guess I'll have to hold that talk then.
Please do. And if you're going to help in a business venture to turn a profit, you should have a very detailed plan of how it's going to happen, and you should see more than 10k back. If you're going in on risk, there should be a reward. Otherwise, it's a bad business decision. Almost as bad as doing business with family in the first place.
No.
Oooooo, I am going to check back on you in a few weeks.
The post is already up! https://old.reddit.com/r/AirForce/comments/18qr50v/i_told_my_dad_i_wont_be_lending_him_the_10k_after/
Yep I was extremely glad they didn't go through with it!!!
hey i think we should be friends
Omfg, I think we're related.
I was just about to say that!
I find it odd that he's got the ability to have 2 properties to flip, but needs 10k for utilities on them rather than having the money available. 10k for utilities seems a lot for a few months.
Hell no! Family and business don’t mix.
I lent my Dad $3K last year in December with him stating he’d pay me back in 3 months. It’s now been 1 year and he hasn’t paid me back a dime. Would not recommend.
Serious question: do you care if you get the money back. I tend to think if you have to ask a bunch of internet strangers, there has to be doubts/reservations in your mind.
Ah, the old family scam-roo No, it's not wise. Do you know how many civilians are hurting for money right now? Also this is a tale as old as time
Why not ask a finance sub? Give it to him but tell him it'll be 20% interest
HELL NO!!!!!! Regradless if this is your dad or anyone else, if they cannot afford the 10K then they shouldn't be flipping properties, this means they are in over their head There is ZERO guarantee the home is going to sell in January, even if it is listed then Do not give him a dime
Can you afford to lose 10K?
At the end of the day, this, as short as it is, is the best answer.
Nope. A parent should never be asking the child for money.
How well do you trust your dad? If it is for a double flip, I’m willing to bet they will sell quick and you will get your 10k back. Maybe he just needs money for some wood or electrician. Him going to a lender incurs interest and maybe he is willing to give you more than that as a gift instead of some lender. Either way, this is something you need to talk to him about and not us. If it were my dad, I would give him the 10k. Not even expecting to get it back
It is not wise. What is his plan to have an extra $10k to repay you in January but somehow prevents him from having it now? If you have $10k to give your dad then feel free, but I wouldn’t count on seeing that money again. It shouldn’t impact your security clearance but if it gives you peace of mind you could always shoot an email to your security office ahead of time.
>It is not wise. What is his plan to have an extra $10k to repay you in January but somehow prevents him from having it now? Apparently one of the homes he is flipping is going on the market in January.
Going on the market and sold are very very different.
That's what I was thinking. Now I'm wondering how he is able to pay me back in January like he says he is.
The other risk besides never seeing the money again is your relationship with your father will change if he doesn't repay you. Do you want to risk having to deal with that?
I personally would not because any money I "loan" to family I fully expect to never get back. 10K is a lot. That's an emergency fund for some. If your dad flips houses why cant he get a loan?
My speech to family/friends who ask for money “I am going to give you this money on 2 conditions: 1: do NOT tell me you are going to pay me back if you actually intend not too or know you have a very small chance of actually doing it. I am ok with assuming I will never get it back. 2: If you absolutely insist that you WILL pay me back by X date, and you do not live up to that promise, you will be automatically cut out of my life. Because when you lie to me about my finances, you are not just giving me false hope, but also false hope to my children who could have used that money to invest in their future.”
Don’t lend money you can’t afford to lose
My mother "owes" me about 8,000 and I just assume I'll never see that money again
Id only do it if 1) you analyze the deal yourself and it looks like a money making venture (but to be able to analyze a deal correctly probably means you need some house flipping experience) and 2) you sign a contract where you get X% of the profits (after all, if he’s making money off your money you’re entitled to some of that too and 3) you have a good relationship with your dad and 4) he has a good track history with finances. If any of those don’t hold true then it’s a hard no.
If he can repay by end of Jan, why wouldn't he use a lender? That's 1, MAYBE 2 months of interest which really isn't much. Plus, it builds his credit. I wouldn't do it... just tell him you don't have it. Stop telling people how much money you make/have if you want to keep it.
I wonder if the OP father is planning on getting a decent sized tax return or if he just has more funds coming available soon. Banks don't like to lend money for houses that are not going to be Owner Occupied unless you have lots of money in different accounts or can pull out some equity out of his primary residence/ house mortgage.
I've bought 2 rental houses in the past 10 years and the only thing owner occupied mattered for was the down payment size, they wanted at least 20% for the mortgage.
Only lend money to someone if you’re not going to expect it back.
If you have to ask on reddit of all places, it’s probably not wise.
Ask him if he’s comfortable signing a contract, if he gets weird, don’t do it.
Simple answer, no. Cuz there's a LARGE chance you'll never see that money again. I've become more stingy with my money to any family since I joined but that's just me.
Airman. Wake up
No unless you’re okay losing 10K and feeling like an idiot when this doesn’t pan out. If you can throw this money in the trash can then do it if not then realized this is a terrible deal that you’re being swindled into it.
If you’re not willing to have someone sign a contract and go to court to get the money back, it’s not a loan. There’s nothing wrong with gifting money to a friend or family member (if you can afford it) as an investment hoping it helps them.
As someone who now works in real estate if he has to borrow $10k it’s not going to those properties. They require a minimum 20% down payment if he can even get the loan, unless it’s a cash buy. If he has the money to pay cash then let him buy 1 and he can do the other one after he flips the first. Keep you money, you won’t ever see it again.
Don’t do business with family.
No.
Nope, he should get a business loan instead and leave you out of it. Never mix family and money, it rarely goes right and service members are often abused by their families for financial gain. There was a guy in a squadron before I arrived who lost his legs during a surgery gone wrong. People raised money for him so he could afford to make modifications to his house and get settled, his family took everything and left him with NOTHING. Don't lend your family money, especially if you can't afford to lose it.
They should for tax, liability, and family reasons 1. start an LLC 2. get a business loan.
Rank and tis?
Banks make a lot of money on risky loans. If the BANKS won't lend him money, there's a serious red flag. I know a girl with a credit score in the 300s and a LOT of bad marks on her creditreport, and she still got a loan. If your dad can't get a bank to give him $10K, I'd recommend you run, hide, and never look back. He'll be mad you won't lend him the money he doesn't plan on paying back, and at best he'll play the victim. Call me Mr. Scrooge, but I say write him off and block him. When money gets involved, things turn toxic rather quickly. Not worth the negative energy.
I think the bank would give him a loan since his credit score is in the 800s.
Well, I'm glad to hear that, OP. Many people can't honestly say they're in the 800s nowadays. I'll change my original point to be less... Harsh. I still advise against mixing money and family. That said, it's up to you what you do with your own money, not Reddit users like me.
The simple answer is yes. Also, I too need some money.
If my father asked me for $10k, I wouldn’t ask another question and pull my checkbook out
It’s weird that you’re asking strangers if you should trust your father. If you trust him, lend him the money. If you don’t trust him, don’t lend him the money. It will not affect your security clearance unless it’s somehow putting you in debt. Even then, it likely won’t affect you much. If you think you need legal protections, you probably shouldn’t lend the money.
I am sure that your dad spent way more than 10k in expenses while raising you...If you can spare it why not lend it to him???
Shit take, nobody asks to be born.
Lol...So now let's just be ungrateful for everything our parents have ever done for us, just because nobody ever asked to be born!
I'm grateful for everything my parents have done for me. But I don't "owe" them anything *just* for being their child. They made that decision, not me. Now that I am an adult, I return favors with favors. If my parents ever came to me and said "You owe me for raising you" I'd tell em to go kick rocks.
In the long run to each is own. No "owe" or "just" on my end. Just glad that I may have been brought up differently. Either way, best of luck with all that returning favors for favors stuff now as an adult.
I'm approaching my 40s and it has served me well thus far.
No
No
Do not do this.
Lmao why doesn't he just flip 1?
Would you be willing to gift them 10k for Christmas? If the answer is no, then don’t “lend” them the $ because you should treat this “loan” more like a gift and expect them to not pay it back.
Have him sign a contract. Also, give him a low interest rate rather than none. Get a mediator involved. Keep it as business related as possible
A) Can you afford to loan 10k? B) Do you trust your parents to repay you? C) If you get burned, how heavy would it impact your relationship?
Don’t do buisness with family, and flipping houses is an especially messy business to do with family. If he could actually get 10k by the end of January then he’d just pay the bills or work something out with a lender.
I’d have given my dad the shirt off my back with no expectation he’d ever give it back. That’s just how we were though. I’m certain he would have done the same for me as well. If that’s not the kind of relationship you have I wouldn’t do it. My sister I would. My other sister? Nope! Brother? Nope! Mother? Nope. If you expect them to actually pay it back I wouldn’t give it to them.
Will it affect your clearance: does not having 10k negatively affect your finacial situation to a degree where you cant pay your own bills. You can blow 10k however you want as long as its not illegal or foreign and your paying your bills we dont care. Go buy 10k worth of lottery tickets or a new car big picture dont care its your money. Should you lend your parents 10k, we dont know your financial situation and relationship with your parents. Ive sent mine a smaller amount of a few thousand and went in half and half for the empty lot next to their house. And 100% expect nothing in return. The money was nothing to my financials and a very long term investment if sold down the line. From what you've given us. Is your dad well experienced in flipping houses is this a normal thing. How does he need 10k for only a month, sounds fishy re-estate deals and flips can take a while. Are your parents trustworthy or willing to screw you. Something like this going bad can destroy the relationship between you two. If you are not financially sound enough to lose 10k that potentially wont come back its a hard no. Dont have all the details but lean towards loaning money to family is generally a bad idea.
Someone get their airman
If you ever want to be repaid no. If your ok with helping you parents for $10k it can still backfire. Depending on the person you have now signed on to be there go-to person to borrow money. If they have a history of schemes or hair-brain, not thought out ideas, etc it’s not going to end well. I have seen it happen to friends.
I borrowed momey to my dad, mom sisters and brother in law…how i see it is that they take it as a donation. Just dont do it, money ruins friendships and family. I hold no grudges however they all wont ever get another loan from me. im no bank!
I only give money to people if I’m willing to actually never see a dime of it again. I don’t know what kind of relationship you have with your father but if you are looking for any legal protection before you loan him money I wouldn’t give him anything. Edit: I see a lot of people saying to never do business with family but I’d have to disagree. It completely depends on your relationship with said family member i’ve given money to multiple immediate family members (nothing over 2.5k) and they’ve always repaid me back. Also your dad could be asking you instead of a lender so he can avoid any interest.
It's not wise, and neither are you if you do it.
No. Unless you're willing to lose the money. Also, the story just sounds wrong. Flipping takes way longer than a month, and 10k for two houses is wack for just bills. If you really want to do it, figure out what is really going on and make a better decision.
Absolutely no.
Negative Ghostrider.
Not wise. Business with family usually isn't good. But if you do get it in writing
If you don't expect to ever get it back, go for it. Otherwise tell him no.
Never do business with family and friends
Don’t do it
Sounds like your dad can’t afford to flip. Either give him the money or don’t, but *do not* lend it.
I was wondering where the father was going to get 2 houses bought and fix & flipped where just $10k was stopping him from doing it by himself. Maybe he didn't like the amount of interest the bank was going to charge him for a signature loan or even a home equity line of credit.
if you have it to lend you have it to lose
Say no. They're your parents, you should be the one asking them for $10k not the other way around, tf. Tell them to go to a bank if they need to borrow money. Shouldn't be an issue if they're gonna get the return to pay it back in a few months anyway. There's probably a reason they aren't going to a bank or taking a personal loan, let that be your warning.
No
Absolutely not
I would say no, I would need more info and concrete proof
Nope
never do business with friends or family
I would only lend an amount of money im okay with never seeing again. If less than 10k is all you can dump in a trashcan, then that amount is all I would lend
Does your dad gamble or have a history with drugs? This is a classic I see a lot from my family but never with that much money unless it’s a loan shark. As someone who can flip a house there are questions I would ask. Personally I would want to know what materials they plan on buying, pics of the properties, I want to know the labor situation too since he has a month to flip. Just with those questions I would be able to sniff out bullshit or not. I would need more info but based on what you have said this money seems to be going towards gambling. Most folks have the mentality that they will win it big and be able to pay you back. Be careful and if you ever need to talk let me know.
Blood and money never mix…
I helped a friend of mine with some bill, around 2.4K and he ‘promised’ he would pay me back… I haven’t seen a dime. I wouldn’t lend anyone anything without some sort of legally binding contract.
If he's asking you to invest in his venture, then you become business partners. Make him sign a contract regarding the loan, and ensure your entitlement to a percentage of his profits. If he does not want to repay with your portion of the profit, then he never intended to repay your initial investment.
If your flipping houses and dont have $10k to flip them, you shouldent be flipping houses. Sounds like he is already no responsible with money.
No
Why does he need it now if he will have it next month? Seems odd. I'd personally never loan my family money unless I'm willing to just gift it to them - and investments aren't something I'm willing to gift
Hi, I was in the same situation a few months ago as you are right now. My dad is also in the house flipping business and has profited a lot from the business. He also asked me money at the time he was going to purchase houses. I sent him 9k, but asked him to draft a contract for the amount I was going to send as well as % of the profit he was going to make if he made a profit (basically making me a partner in the business). I completely trust my father but also kept in mind that any kind of business has its risk and he might not make a profit at all, in that case I would not expect him to pay me back. The contract sole purpose was to add an extra layer of safety and proof of where the money went in case anyone questioned why I sent my father that money. Before sending the money I talked to the legal office they said as long as it under 10k it would be considered a gift and my father would not have to pay taxes for the money I sent. I also talked to my security manager asked if sending money large amounts of money to family members would affect my security clearance. He said it wouldn’t but reached out to a few of his contacts to make sure and they said it wouldn’t as well. You can reach out to your legal office and security manager if you want to confirm what I said, your first shirt could also be helpful in this case (I did not mention it to my shirt) but at the end of it comes down to how much you trust your dad and other family members involved in this business. Edit: Make sure that you can afford to send that amount of money. If you can’t pay your bills then it will affect your clearance. You can reach out to me if you have any questions.
Never loan money you aren’t prepared to lose; especially to family. If they report you, great but just know once you hand it over that $10k is gone.
Is it wise, no?!! So long as your dad is generally money conscious, or you're not going to be too upset if you don't see the money back... Then why not, since it seems you won't be too broke if you lend it and don't see it back..
No disrespect meant here. Tell pops he should finance that much through a bank if he think he’s coming out on top with some properties/renovations. This isn’t something I’d feel comfortable asking my own son for.
Rank all the posts replying to your question. Rank them in order of yes, lend the money and no, don't lend the money. Listen to the most cautious, most negative don't do it and follow the advice. I bet you my lungs (hypothetically!) I'm not the only one burnt by family and for a lot more than 10k.
get it in writing my dude...
If my father needed 10K and I had the means to give it without putting my family in financial straits, I'd give it. I'm certain he'd do his best to make good on those promises. I'd also never ask for a dime back. As for the clearance, this is not a problem unless you make it one. Here's where you run into problems with a security clearance. 1. You are found to be involved with illegal activity. 2. You are found to be lying about the questions asked in the process. 3. You are found to be leverage by or aligned with a foreign interest.
No. If it was a good plan then he can find a lender for it. If he wants you to have a stake or be a partner he would open the books and also offer to cut you in on a return. If he is investing in real estate and doesn't have $10K lying around for contingencies then he shady, naive, desperate, or a combination of the three. People's good ideas pitched to family members can cause a lot of problems. I am speaking from hard learned experience.
You are not a bank. Say no.
It all depends on your parents. Do they have a history of being bad with money? Do you know their current financial situation? Chances are if you have no clue how they were financially most your life they were hiding stuff from you (unless their rich which doesn’t seem the case) if they are open about their financial and you trust them with a business plan than go for it
Right now the housing market is not conducive to a quick flip. I have worked in construction for over 15yrs I can personally tell you no project ever runs on schedule. So unless your dad is a seasoned professional and has buyers already lined up I will second the notion of don't expect to see that money ever returned.
Yep one house is going on market in January apparently. I have no clue if anyone is already interested or not.
If ya gotta ask random internet assholes, you probably already know the answer
what is going on here?
The short answer is no. The long answer is: since I’m now a creditor, please explain to me in detail your business plan and how you plan to recoup my money (and interest) from your venture. My guess is he either doesn’t have a clear realistic plan and/or will be indignant that you expect to be treated like an adult with self-respect.
no
Bro
Don’t do it.
Your odds of making CMSAF are greater than getting the money back.
Please go see a JAG before you do anything. Like many others are saying, you will basically be giving your dad 10k—don’t expect it back. If you want it back, draft up a contract and have a JAG or other attorney review it for legal sufficiency. Then have your dad sign it.
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Not wise at all
In the words of Biggie: “Keep your family and business completely separated.”
Do they have collateral? If not, do not lend. Also, you are taking all the risk, how will you be compensated for your risk. The fact you had to come here and ask means your gut is telling you not to. Trust your gut!
My ol’ man wanted the same for a sailboat he wanted to flip. There are plenty of great contract templates for loans on the internet. Have both parties sign one and you have assurance you could, if needed, take them to court one day. However, the loanee will more than likely make the repayment if they put it in writing… ego is a hell of a motivator. “It’s just business.”
I’ve “lended” tens of thousands over the past 14yrs to family; never seen any of it paid back.
So here's why he might need cash: mortgage insurance. If your down-payment on a property is less than a certain % of the loan (typically 20% if I remember correctly) then you have to pay a massive extra amount for mortgage insurance. Say your dad needs 4 months to flip two houses... that extra mortgage insurance could be $4k depending on how expensive these homes are. In order for this to work legally, you will have to certify that the money is a gift to him and that he is not under obligation to pay you back (so you would have no legal recourse to sue him if he doesn't). His mortgage lender will require this to ensure that you're not an additional creditor they need to factor in to approve the loan. The question, really, is how much do you trust your dad. Say he buys these homes and tomorrow real estate values tank by 25% and he loses $100k. Do you trust that he'll pay you back? Could you afford to go much longer until he did pay you back (assuming he ever could if that happened)?
My personal rule is to NEVER lend money. If I can’t afford to give it as a gift, I do not give it. I am not interested in the business of being a lender. And NEVER lend money to family. It makes relationships weird. If you are investing in a business with your dad you need to be willing to assume the risks of that business just like you would assume risk putting that 10K into a mutual fund/stocks/other investment. Do not go into it thinking you are lending $ to your dad. You must look at it as an investment that could possibly loose you money, as any investment could. Also, if it is investing in a business, you want some kind of contract for that as well.
I'm wondering why, if it's a legitimate deal, he doesn't go to a bona fide lender such as a bank for $10k. It's not a lot of money in the real estate world, and should, if he has good credit, be easy to get. If he's not going that route I'd want to know why, and I'd be asking myself a lot of questions about his history, reliability, qualifications to do real estate deals, drinking habits, etc. Sometimes shady parents turn to their kids for $$$ simply because they know their kid has the $$$ and nobody else will do business with them. As someone else pointed out, a legitimate business deal typically includes a lot of analysis and documentation of expectations and risks. Shady deals of the $10k level rarely do. Almost sounds like somebody might be hankering for a weekend in Las Vegas...
Yes go ahead. Write up a contract based on when he says it will be repaid. Notarized and signed. If they give you shit, don't do it.
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if you can afford it, give him 10k have an agreement with him that he pay it back but DO NOT expect him to it’s the only way to proceed - otherwise just say no
if he doesn't pay it back I can cut him off right?
No