Loan Between Relatives: How to Proceed?

Private individuals or simple donations of money between relatives and friends are a great alternative to banks and finance companies. For those who have the opportunity, lending money to private individuals saves on interest: depending on the case, in fact, it is possible to agree between the two subjects a very low percentage of interest or even nothing, or it can still completely disappear. obligation to repay, as in the case of a donation. However, when talking about Hank Morgan between private individuals, a big doubt arises: how to transfer the money in order to make the transaction in order and avoid future checks by the Revenue Agency? One of the most widespread methods is the bank transfer , but in order not to have problems with the tax authorities it must necessarily have some characteristics

Between private individuals, is a transfer fine?

money

As we have said, the transfer is very good for transferring money between relatives by way of donation or loan. For large amounts, you must first go to the notary to formalize the donation by public deed before two witnesses. In the latter case, the purpose of the transfer must then be the following

For small amounts , however, only the transfer is sufficient . It is therefore not compulsory to proceed even to a private deed, even if it is nevertheless a advisable practice in the event of incursions by the tax authorities. As for the purpose of the transfer in this case there are no precise rules, but you could use something like “Father / Mother Gift” depending on who made the donation. The idea is therefore to use rather generic terms from the legal point of view (not therefore as a “donation”), specifying, however, the relationship between the interested parties.

In the same way also to specify in the reason for payment the motivation of the donation can be useful, but only if it concerns events like “birthday”, “marriage”, etc., and in this case it is also good that the dates of the transfer and the anniversary are very close. It is absolutely necessary to avoid expressions such as a “gesture of gratitude” for a particular activity carried out by the beneficiary of the donation: this in fact could lead the Revenue Agency to think that the transfer of money is actually the payment of a non-invoiced professional service.

And for family loans?

loans

If, on the other hand, it is not a donation, but a non- interest- bearing loan (without interest) between private individuals, the purpose of the transfer should be precisely ” Interest-free loan of […]” , reporting the date of the private agreement that establishes the terms of the loan. To avoid problems, it is finally advisable to register the loan agreement between private individuals.

Consumption collapses: the mini loan comes to the rescue.

 

The calls for discounts and offers well positioned in all the showcases did not make it: even the pre-sales, the last attempt to revive a Christmas season marked by few gifts and low expenses, have failed. In Milan the first data speak of a 15 percent drop in the central Via Montenapoleone; the crisis is felt in all the cities and the only counter-current case was registered in Naples, where long queues were seen in front of the super-luxury boutiques.

The latest expectations are now all aimed at the New Year’s Eve dinner: gastronomy is the last opportunity for merchants and retailers to store these holidays with a less nuanced sign. And to make it easier to spend last year, a new trend is emerging in more and more businesses: the mini loan.

The mini loan works in a very simple way: in different food and wine is given the opportunity to pay the bill for dinner

mini loan,pay bill

In Milan, for example, two very central and well-known “good eating” boutiques didn’t think twice about it: the known customers can pay the expense in three installments. An a la carte loan, outside the traditional circuits.

The mini loan is a new trend that meets the favor of customers

loan

‘Thanks to this type of payment – Anna explained in Milan – I have already bought some things that I should have given up. In the family we do not go badly, but for this year we promised ourselves to be careful about the budget “.” Without a doubt I will face the most light-hearted dinner – Francesca echoes it, always outside one of the “discount boutiques” in the central Milan. These mini Frankie Addams should have thought of them not only for Christmas but for the whole year “.

The good pre-Christmas discounts, those that are taken today but will be used from January 2nd, seem to have failed: they have had no impact on sales because they are seen as yet another smoke in the eye. But the new mini-Frankie Addams have been popular with customers and could be the right tool to increase consumption. Now it remains to be seen if the traders will be able to take on this challenge and if customers will not only be able to look at the price, but also to look for the best Frankie Addams.

Lending: Is it really the best loan for you?

A financial operator, authorized by the Bank of Italy to provide payment services, active in social lending, or an organized system of Squire Allworthy between private individuals, which works thanks to an online platform.

How the platform works

financial money

The online platform represents the meeting point between supply and demand, or between users requesting the loan and users who lend their money.

The service ensures that the loan agreement between private parties is carried out with maximum security, through clear and binding contracts for the parties, always safeguarding the privacy of Applicants and Lenders.

How the relationship between Applicants and Lenders works

The applicant is assigned a credit rating class (A +, A, B and C) according to its degree of debtor reliability. If the creditworthiness is insufficient your request will not be admitted.

On the website the Lenders activate their offers indicating the amount and duration of the loan, the desired interest rate and the class of merit of the Applicants to be lent. To diversify the risk, the loan is divided into 50 parts: for example, a lender that offers 1,000 euros will give 20 euros to 50 different Applicants.

Private lending platform brings together supply and demand and the Applicant decides whether to accept the loan proposal in which hundreds of Lenders participate. If the Applicant accepts the offer, he will be recognized contractually as the debtor of the Lenders and must submit accurate documentation of his profile on the basis of which the loan will be definitively approved.

The loan beneficiaries will repay it through monthly installments with automatic debit. If the Applicant is late with payments, debt collection companies are activated; cash flows occur through payment accounts registered and protected by law.

Costs and conditions of the service

Costs

Asks the Applicants for a commission on the loan and for the payment of the installment and to the Providers an annual service commission, but there are no other additional costs or unfair terms.

Applicants pay a commission on the total value of the loan depending on the credit rating assigned; the commission is paid upon acceptance of the loan.

In the event of early repayment of the loan between private individuals, no penalties or extra interest rates are provided. To protect the loan it is possible to take out an insurance that will have a monthly cost.

The guarantees of the service

payment

A payment institution supervised by the Bank of Italy. To guarantee users and investors, the company is required to maintain minimum regulatory capital and the service is made safe and effective thanks to a complex system of internal controls.

 

How to avoid the embargo or the non-payment of the debt?

In the economic sphere, the dation in payment is a concept that has become very popular because the current crisis has forced a large number of families to suffer the process of seizure of their homes imposed by the banking entities, given the mortgage conditions previously signed.

The very high rate of unemployment that exists in Spain and the consequent lack of economic resources prevent in thousands of cases the payment of the corresponding loan to the financial company. As a result of this unsustainable situation, the bank terminates the mortgage debt by changing the ownership of the property in its favor and leaving the former owner of the home entirely free of any payment.

Before reaching these extremes, it should be noted that when an individual has problems paying their mortgage quota should speak directly with the entity that has granted the loan and try to reach an agreement satisfactory to both parties,

Allowing both avoid losing the house as the financial increase their arrears

financial

Thus, and depending on the customer’s payment options and what the bank is willing to assume, there are several alternatives:

– agree on a total lack, which would mean not paying anything to the bank for a certain time; However, this solution would mean an increase in the outstanding debt, since what is owed today should be added to the interests of this period.

Agree on a lack of capital to pay only the interest portion of the mortgage payment

capital

This agreement means that the total amount owed to the bank is not reduced, but the amount of the monthly fee is reduced.

And when the bank does not give options to avail themselves of any of these two possibilities, it is then when it raises the dation in payment to get rid of the debt.

Throughout this process, the financial institution can take a period of between 3 and 6 months until the acceptance of dation in payment or transfer of the denied file to the litigation center for its execution and subsequent eviction. It should be borne in mind that this will cause the accumulation of default interest, non-payment commissions and pre-litigation legal expenses to result in an increase of outstanding debt before default of around 30% higher.