Financial difficulty

Hi @DevS

Firstly, welcome to the forums.

It sounds like this friend has put you in a really difficult position. Part of me is wondering if they may have overextended themselves when giving you this loan and have found themselves in a financial strain as a result. Regardless, it's left you in a stressful situation and for them to send you legal notice seems like it's come as a real shock, as I think it would to most people who had asked for help from a friend.

The first thing that comes to mind for me, is whether you've looked into financial aid? AskIzzy is a great resource that curates all sorts of social supports across Australia. It may be worth taking a look and seeing if you're eligible, so it can take pressure of this situation and give you some breathing space as you get back on your feet.

Hi Ru-bee,

Thank you for the immediate response. Its a bit complex than that. I moved here from NZ just two months ago and this person who was a family friend, who knows all my life crisis and financial situation offered help when i initially discussed about relocating as i did not want to stay and be in the vicinity of some people. I was ready to look at my situation and plan my relocation by 2025 when he offered to help. I was very reluctant to take it as i was scared of the financial stress it puts me in however, he was very clear that he was ready to give me some time before "we" start making a plan of repayment. However, i was making my plan of starting my repayments by Jan 2025 so that i get some time to settle down and feel peaceful. This legal letter came in as a shock and i am really in a place where i have no clue what to do. However, i called EAP services as a first step to get some counseling to feel better. But any advise will be highly appreciated as i have no friends or family in Australia. All i have is my son who knows nothing about this.

Thanks,

Hi @DevS ,

Welcome to the forums. I'm sorry to hear about what is happening.

I really encourage you to contact a financial counsellor. The government provides free services. https://moneysmart.gov.au/managing-debt/financial-counselling

They can also assist with the legal side of things here https://moneysmart.gov.au/managing-debt/free-legal-advice

Was there ever a formal agreement drawn out?

I have lent money to people in the past and have drawn out a legal document with details what repayments look like and when it needs to be paid back.

See how you go with the moneysmart link above. There are also other free financial services available.

Hi Tyme,

Thank you for the response and the useful links.

There was no formal agreement. I accepted his suggestion and borrowed only because i know their strong financial side and with the right intention to pay back. I still want to pay back however, i do not have lumpsum amount as they demand in the legal notice. Here's a person who was ready to buy a 20million dollar house in NZ (or as what he told me). Nevertheless, i will go through the links and make some plans of repayment and suggest to him. Hopefully they agree. This has put me in a highly stressful situation. I was looking forward to finding a second income and finally get my life back. But some foolish decisions jeopardies all plans sometimes.

Thank you for the support,

Hi @DevS, what a terrible position you've been put in. I'm no lawyer or have any legal expertise but I would be thinking how much validity this legal letter he sent you has. If you never made and formal, in writing agreement, then how can he legally threaten you for not paying it back in full straight away. He agreed to load you the money and agreed to let you start paying later without making any formal agreement on the process of when and how. I would think (and again, not a lawyer) you have every right to pay him back as originally verbally agreed to because he can't legally prove otherwise. I'd definitely be seeking some financial/legal advice. It seems to me like he's just trying to scare and intimidate you into paying it all back right now, knowing he can't force it, hence the legal threat rather than coming to you and discussing it.

I hope it works out well for you, it really is an incredibly amount of stress he is putting on you unfairly.

Hi @MJG017,

Thank you for your kind words. Yes, indeed it is putting me under lot of stress and my heart beat is always on the rise. It is so hard to focus on work and so much struggle.

I have used some resources that are given to me by this community and seekin ghelp to handle this matter. I may need to go to a lawyer as a next step. Though i have a job, my current situation may not allow me to get any free service, but I am trying.

the inital conversation we had was to give me sometime to settle in find a job and look at my expenses and start making a repayment after a year. If by anychance i find it easy to start making payments early i would do so. This was the verbal agreement or the discussion we had. However, after a couple of weeks i moved in, he send me a message saying that he has to pay his taxes and its somewhere around 30k and need the money immediately. We were still keepin gin contact and i have given him number and my whereabouts as good friends. I went back and explained that i dont have that much money to pay in lumsum and thats not what we were discussing, to which he become so defensive and started threatening me that if i dont repay immediately he will recall using some tantric ways. Right from then i am constantly under stress and i did try to borrow money from friends and family like 5k but the thing is i dont have many rich friends and i dont want to put anyone in the same situation. If i had that kind of money, i wouldnyt have accepted his offer in the first place. i accepted because he was not a bank and knowing he is very rich and he can wait for sometime before i start repaying. he is asking me is 3 months not enough to settle down, i dont know how to answer that, i dont even have a good idea of what would be my regular expenses look like.

Anyway, i am keepng my brave face up and trying none of this affect my son. I am sure i will find light at the end of the tunnel

Kind Regards,

@DevSI hope you get some good advice. As you say, it was a verbal agreement and so he has no proof of any formal agreement in writing, so I'm not sure what he could legally do in this case. So I definitely think getting some legal advice would help you. I'm not sure how he thinks he can force this change on you. He also seems to think this money is some kind of inconsequential amount, demanding back in full so soon. It may be to him, but it isnt to most people.

I found this article regarding verbal contacts in Australia, which you may find informative... https://pbl.legal/guide-to-verbal-agreements-in-australia-are-they-legally-binding-and-enforceable/