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WAS IT A GIFT OR A LOAN? Click here to save article in WinZip.exe format to your PC Frequently
parents will make gifts to their children for a variety of reasons.
In one case parents gave $150,000 to a son who was about to get
married. The son and his
future wife intended to use the moneys toward the purchase of new home.
Additional monies were borrowed from a bank to effect the purchase
and to pay for certain renovations and the parents were asked to sign a
statement saying that the monies were a gift.
After signing the gift statement, the parents’ lawyer suggested
that a note and mortgage deed also be signed by the son and friend which
was signed by them. Sometime
later, and before the marriage occurred the couple split up and never
lived in the house. As a
condition of getting a bank loan, the parents signed a statement that the
$150,000 was a gift. Well,
were the funds given as a gift or as a loan? After
the breakup, the parents wanted to make sure that they got the money back
and sued both the son and his now estranged friend.
The parents argued that the monies were really a loan.
But the parents had the problem of the statement they signed saying
that the monies were a gift. I
will not tell you how the case came out.
If you would like to know, telephone me. |
