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Can You Be Charged Interest on Money You Owe Without a Written Contract

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  • 12-12-2013, 02:57 PM
    hajew86
    Can You Be Charged Interest on Money You Owe Without a Written Contract
    My question involves a consumer law issue in the State of: AZ

    My fiance' went into a "verbal" agreement with her mother involving paying $500 of a $900 rent payment while she is attending college earlier this year. In the verbal agreement they did not discuss or dictate a repayment, a repayment timeline, or an expectation for repayment. In addition, she is requesting that my fiance' tack on a "monthly" interest charge to the "money owed".

    Furthermore, her mother is requesting that she be paid back for the vehicle that was given to my fiance', in the amount of $3000. The title was in my fiances' name and was in possession of the vehicle until she traded it in recently for a newer vehicle. Again, she is asking for a monthly interest charge to be added on.

    Does her mother have claim to what she is requesting?
  • 12-12-2013, 05:14 PM
    llworking
    Re: Interest Charged on Verbal Agreement
    Quote:

    Quoting hajew86
    View Post
    My question involves a consumer law issue in the State of: AZ

    My fiance' went into a "verbal" agreement with her mother involving paying $500 of a $900 rent payment while she is attending college earlier this year. In the verbal agreement they did not discuss or dictate a repayment, a repayment timeline, or an expectation for repayment. In addition, she is requesting that my fiance' tack on a "monthly" interest charge to the "money owed".

    Furthermore, her mother is requesting that she be paid back for the vehicle that was given to my fiance', in the amount of $3000. The title was in my fiances' name and was in possession of the vehicle until she traded it in recently for a newer vehicle. Again, she is asking for a monthly interest charge to be added on.

    Does her mother have claim to what she is requesting?



    Maybe, there is not enough info here to know. It would be better if your fiancée posted herself because she can answer questions that you cannot.
  • 12-13-2013, 09:06 AM
    hajew86
    Re: Interest Charged on Verbal Agreement
    Thank you for the response. I'm attempting to do some legwork for her and since I am aware of the situation I'm fairly certain I can answer any questions you may have.
  • 12-16-2013, 02:15 PM
    PADriver13
    Re: Can You Be Charged Interest on Money You Owe Without a Written Contract
    This is why it's a bad idea to borrow money from family members and friends. Can you be charged interest? I don't see how - from what you are saying, there are no repayment terms. There is no agreed on interest rate, etc. etc. On the other hand, your fiance got into a bad situation where she agreed to pay a rent of $900, but can't. So the mother (very generously it appears) lowered that payment to $500. I would tack on a monthly interest charge too, if I were the mother and had cut your payments in half already.

    So then your fiance turns around and trades in a car (worth $3,000) and apparently agrees to purchase a newer vehicle. So your fiance couldn't pay the rent, was given a generous discount, and then turned around and traded in the car she was given (and likely incurred car payments) while disregarding the money owed to mom.

    This isn't a legal question. This is a question about "doing the right thing". It sounds to me like your fiance's mom took care of her daughter and helped her out when she needed it. Do the right thing and be thankful for the help. Pay mom back.
  • 12-16-2013, 02:39 PM
    hajew86
    Re: Can You Be Charged Interest on Money You Owe Without a Written Contract
    Unfortunately, there are more details in this however in an effort to summarize my question I did include them.

    She says she was forced into moving out of her living situation at the time into a new apartment that her parents (mom mainly) said that she'd help out because she knew her daughter was going to school full-time while working a part-time job. And again I reiterate, there was no agreement of interest or even a repayment of funds.

    The car situation is this, my fiance' bought this car outright with her own cash she had saved at around 17. At 19 she was able to buy a another vehicle with her own cash and decided to sell her first car to her mom. Moving forward, she gets in a accident and the second car is totaled. Her mom then says she can use the first car and/or purchase it. However they never came to an agreed price before her mom signed over the title to my fiance'. On the paperwork it states "Gift".

    Look, I'm encouraging my fiance' to pay back what she legally owes but NOT interest her mom wants to tack on...just because. That's not right. I'm simply asking if her mom can legally sue for interest charges, which I could see her doing, because she's that type of person.
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