Dear Grandparenting: My daughter married the man of her dreams and got right to work starting a family. I had a granddaughter 11 months later. The place they were living had all kinds of problems. It was a cramped fourth floor walk-up apartment without a decent green space nearby for my granddaughter to play. Then there was that robbery in broad daylight right out on the street.
Everything pointed to moving out. But to trade up, my daughter and son-in-law had to show they could afford a new home. I offered to loan them an amount in the five figures, but the lender wanted a “gift letter” saying my money was not a loan. So I signed it.
Can’t you see where this is going? The plan was to return my money after they sold their apartment but my son-in-law had other ideas. He invested the money some time before they got divorced. Then he said he would report me for mortgage fraud and cause trouble if I leaned on him to repay the loan.
So now he lives in a nice place while my daughter has an apartment. This money was for my granddaughter and not him! I am too embarrassed to tell anyone how I screwed up. What do I do now? Tami, Boston, Massachussetts
Dear Tami: Neither a borrower or lender be cautioned Shakespeare, but it becomes difficult to resist when family welfare is concerned. Throw grandchildren into the mix, and most grandparents cave right in.
Most such transactions daresay end without disaster, but lending money to loved ones remains an emotionally loaded issue. As a rule of thumb, grandparents should never lend more than they can afford to lose. Consider the impact on other family members to avoid resentments and infighting. Draw up a contract and have documents notarized to provide legal standing should borrowers default. Many web sites offer free promissory forms.
Your son-in-law is a dishonest rat, but you can’t exactly claim the high moral ground either. Falsifying the debt to income ratio makes you culpable, all good intentions notwithstanding. All things considered, it seems best to move on. Thanks for sharing — we hope you will spare other grandparents from falling into the same dilemma.
Grand remark of the week
Bea Marie from Seattle, Washington is “easy to please” when it comes to granddaughter Ashley, age 16 months. “Just listening to her breathing into the phone makes my day.”
Dee and Tom, married more than 50 years, have eight grandchildren. Together with Key, they welcome questions, suggestions and Grand Remarks of the Week. Send to P.O. Box 27454, Towson, MD, 21285. Call 410-963-4426.