Author Topic: Money owed to a friend  (Read 1675 times)

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r_ask

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Re: Money owed to a friend
« Reply #15 on: March 05, 2013 05:27:24 PM »
Thanks everyone for the helpful answers.

If my friend decides to take it to the court, what kind of legal fee she and I would incur? The sum I still owe is around 20 K so I guess it is out of the jurisdiction of the small claims court.  Would the legal fee be a prohibitive factor for her to take that route? I have never hired an attorney so have no idea what do those people charge.

Thanks again.

arnanda

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Re: Money owed to a friend
« Reply #16 on: March 13, 2013 05:13:45 AM »
You're right, most are capped at 5K.  It would have to be another venue.  Usually the interest would be whatever is held to be reasonable--she could use the CC interest if she can proof you knew that it would be charged interest OR the maximum amount of interest in your state. 
TUN - 791/850 (05-28-2014). EQU - 816/850 (01-19-2014). EXP - 789/850 (08-07-2014).
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r_ask

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Re: Money owed to a friend
« Reply #17 on: March 15, 2013 03:04:38 AM »
Here is an update.

She called me and told me that she is getting a lawyer to collect and the lawyer has promised her 50 cents for every dollar I owe.

The thing is, I don't have any assets worth that money. I will be forced to file for bankruptcy if she files a suit. I don't want to do that because I will be unable to find a job, in case I need to, if there is a bankruptcy on my credit report.

I owe her the money and I really feel bad for not paying it back. I would love to if I could but I can't.  I can go around and ask for a little bit of money here and there, doing a second job (which will kill my family life but I gotta do what I gotta do) and  I can give her a better deal than 50 cents for a dollar, but then I will have no reserves left to pay the rest of the loan. I will have to ask her to settle the loan for a lesser amount that I owe her. So, here is the question: What do I ask her to write in a letter assuring me that she would settle for a lesser amount and will not come after me for the remaining amount?

CleaningUp

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Re: Money owed to a friend
« Reply #18 on: March 15, 2013 03:34:11 AM »
Something for the OP to think about.

While a law suit and a court judgement are not particularly things that one wants on his credit report, the court will order a repayment plan, and that plan will be a lot more generous to the debtor than the creditor wants it to be.

The court may well be your friend here if a judgment is not something that will bother you.


jreed

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Re: Money owed to a friend
« Reply #19 on: March 15, 2013 03:08:51 PM »
Here is an update.

She called me and told me that she is getting a lawyer to collect and the lawyer has promised her 50 cents for every dollar I owe.

The thing is, I don't have any assets worth that money. I will be forced to file for bankruptcy if she files a suit. I don't want to do that because I will be unable to find a job, in case I need to, if there is a bankruptcy on my credit report.

I owe her the money and I really feel bad for not paying it back. I would love to if I could but I can't.  I can go around and ask for a little bit of money here and there, doing a second job (which will kill my family life but I gotta do what I gotta do) and  I can give her a better deal than 50 cents for a dollar, but then I will have no reserves left to pay the rest of the loan. I will have to ask her to settle the loan for a lesser amount that I owe her. So, here is the question: What do I ask her to write in a letter assuring me that she would settle for a lesser amount and will not come after me for the remaining amount?

First off I sincerely doubt an attorney promised her anything.  That's a pretty big no-no as crazy judges do crazy things.  Plus any attorney knows the risks of getting a judgement only to have the target of their attack go bankrupt and pay nothing.  Furthermore, even if you had some assets, the courts can't randomly sieze assets to pay off a debt.  In some cases a lien can be placed against houses/cars.  In my experience that isn't terribly common.  Your "friend" may be angry enough to do it.

Second, most jobs do not pull credit reports.  And in the vast majority of cases, even if you have a bankruptcy it won't impact your candidacy for a job.  There are exceptions like certain jobs in the accounting and financial services or even executive level positions.  I'm not sure if that applies to you, but keep that in mind.

A bankruptcy is rarely the death sentence people make it out to be.  I actually do work in the financial services industry.  I have a judgement against me and for a while had very poor credit.  (below 575).  All I needed to do was explain what and why to HR.  No problem.  So don't stress yourself out over a bankruptcy unless you know for a fact that you will lose opportunities because of it.

Having to pay off a friend is a little different than some random bank.  I don't envy you. 
If you look at my posts and the type of questions I've been asking, you'll quickly come to the conclusion that you shouldn't listen to anything I say.

arnanda

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Re: Money owed to a friend
« Reply #20 on: May 08, 2013 05:19:17 AM »
I doubt the attorney promised anything of the sort.  If you have that 4K or a tax refund I would be paying it back to her ASAP.  I would be making monthly payments to her.
TUN - 791/850 (05-28-2014). EQU - 816/850 (01-19-2014). EXP - 789/850 (08-07-2014).
Abbreviations 1st Thread
Abbreviations 2nd Thread
Smurfy's Ease of Use

silverzgirl

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Re: Money owed to a friend
« Reply #21 on: May 08, 2013 05:04:00 PM »
Thanks Bill. What is unjust enrichment? I didn't buy a property or anything of the value that would be considered "enriching" myself with the money lent. How can that doctrine be held against me?

Unjust enrichment is where one person is unjustly or by chance enriched (you + 25K in cash) at the expense of another (ex-friend), and an obligation to make restitution arises, regardless of liability for wrongdoing (agreed to pay back).

It does not matter how you spent the money. You were enriched when you took it.
“Know your enemy and know yourself and you can fight a hundred battles without disaster.”  - Sun-Tzu

I am not a lawyer, nor do I play one on TV. I once thought I was a lawyer when I was litigating in a courtroom, but turns out I just had Patron induced bed spins and dreamed it all. Take my posts with a grain of salt...and a shot of Patron. But not so much you think you are a lawyer.

Refused!

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Re: Money owed to a friend
« Reply #22 on: May 11, 2013 04:17:55 PM »
I'm just thinking if the "friend" goes to court is there any need for OP to hire a lawyer? Seems to me court proceedings will be more of a formality of sorts, basically do you owe? Yes. Here's a payment plan. As such OP then  doesn't have to file BK, gets protection against the "friend's" antics and walks out with a comfortable payment plan.
Rule of thumb when dealing with debt collectors...don't assume you owe a debt, assume your rights are being violated, because most of the time they are...The only way to deal with unscrupulous debt collectors is to know your rights (FDCPA/FCRA) and fight back...

 

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