Have you given money to a child, parent, brother or sister, and is there now a dispute about repayment? Then the key question is whether a loan was agreed, or whether the money could be kept as a gift. The family relationship does not provide an automatic answer. Even an interest-free arrangement can be a loan, while a large sum may, depending on the circumstances, actually have been a gift.
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A family loan often only becomes a legal problem when relationships change. The lender needs the money back, repayments stop, a child divorces or a parent dies. What previously seemed obvious must then be explained to someone who remembers things differently or was not present when the original arrangement was made.
A sound assessment therefore starts with the arrangement made when the money was provided and with how the parties acted afterwards. Below you can read how to substantiate a family loan, when payment can be demanded and what to record if you do reach an arrangement after all.
What is a private loan within the family?
A private family loan is a loan concluded directly between the people involved, without a bank acting as lender. The term does not mean that a notarial deed is always required. A loan that has been made can also be evidenced by an oral arrangement, bank transfers and correspondence. However, separate formal requirements apply to a right of mortgage as security.
The essence of a loan of money is the obligation to repay an equivalent amount. This follows from Article 7:129 of the Dutch Civil Code (BW). Read the statutory rules in Book 7 of the Dutch Civil Code, Title 2c. The precise rights then depend on factors including the term, repayment arrangements, interest and the capacity in which the parties act.
Note the difference between lending and promising in advance to provide money later. Under Article 7:129b of the Dutch Civil Code, a private lender is not simply bound before the money has actually been provided or before a written undertaking to do so. This blog focuses mainly on amounts that have already been provided and whose existence or size as a debt is disputed.
Loan or gift is assessed by reference to the arrangement
With a gift, the intention is to benefit the other person without any obligation to repay. With a loan, repayment is precisely part of the arrangement. A description such as “for your house” can fit either. That is why conversations, messages, documents and later actions must also be considered. The purpose of the payment does not always tell you which legal basis the parties chose.
For example, a parent may lend money for the purchase of a home and then make a separate gift every year. That does not automatically turn the whole loan into a gift. Conversely, a document headed “loan” may raise questions if the parties expressly agreed that nothing would ever have to be repaid. The legal relationship as a whole must be examined.
The arrangement may also change afterwards. A lender may waive part of the debt or accept a new repayment arrangement. In that case, record which amount is waived, which balance remains and which conditions apply. Without clear records, disputes arise later as to whether only a postponement or, on the contrary, a definitive waiver of a claim was intended.
No interest does not automatically mean a gift
Family members can lend money interest-free. The absence of interest therefore does not prove that there is no obligation to repay. For a loan of money between natural persons who are not acting in the course of a profession or business, contractual interest is only owed under Article 7:129c(1) of the Dutch Civil Code if it has been stipulated in writing.
Distinguish between interest for the use of the money and statutory interest for late payment. If a debt that is due is not paid on time and the conditions for default are met, statutory interest may be payable. That is a different question from whether interest over the entire term was agreed at the outset.
Tax treatment requires a separate assessment. Interest, gifts and a loan for your own home may have tax consequences. A tax return or tax advice may contain evidence of how the parties described the relationship, but does not automatically replace the assessment under civil law. Have the tax conditions checked without reducing the loan dispute to them.
What evidence helps with a family loan?
The more of these documents you have, the less the dispute depends on who remembers what. Tick off what you have to hand:
- A signed agreement: stating the amount, the parties, the repayment and any interest. This is the strongest evidence, but not the only evidence.
- The proof of payment itself: a contract for €40,000 does not prove that this amount was actually transferred. If it was provided in instalments, record how those payments relate to each other.
- The description on the bank transfer: “loan” or “repayment” in the payment reference carries considerable weight.
- Messages discussing repayment: WhatsApp, email or text messages, with the date and the full conversation thread, not a single isolated screenshot.
- Repayments already made: a part payment is an acknowledgement and interrupts the limitation period (Article 3:318 BW).
- Annual balance confirmations: see the example overview below.
- Gift letters, separate from the loan: stating for each year the amount, the date and that it is a gift.
- Tax returns in which the loan or gift has been included: these show how the parties themselves saw the relationship.
- A will or earlier statement about waiving the debt: an oral remark that “you don’t have to pay it back” is legally something different from a recorded waiver.
- Details of the debtor: was the loan made to your child, to the couple, or to both of them jointly and severally? That determines whom you can hold liable.
A signed agreement stating the amount, the parties and the repayment is an important start. Add the actual proof of payment. If the money was provided in instalments, record how those payments relate to each other. A contract for €40,000 does not in itself prove that the full amount was actually received.
With oral arrangements, messages are often important. Think of an email in which the child asks for a loan, a parent confirms when repayment is due or a brother later asks for more time. Keep the complete communication and not just a selected sentence. Bank statements showing repayments or interest can also support the alleged arrangement.
Records may contain additional indications. A balance statement confirmed by both parties, an explanatory note from a civil-law notary or correspondence with a financial adviser may be relevant. Record who drew up the document and who agreed to it. A list kept by one party alone is not the same as a balance acknowledged by both parties.
Witnesses must be able to testify from their own observation about what they heard or saw. A family member who was present at the conversation can provide different information from a family member who later took sides in the conflict. Keep statements factual. Do not ask anyone to make a recollection more certain than it really is.
Who is the lender and who has to repay?
With family payments, the identity of the parties sometimes becomes blurred. Money may come from a joint account of the parents, be transferred to one partner and be used for a jointly owned home. That does not simply mean that both parents are lenders or both partners are debtors. The arrangement and the relevant rules of property law must be examined.
If a child signed together with a partner, joint and several liability or another division may have been agreed. If only the child accepted the loan, the partner does not automatically become a co-borrower merely by living together. In the case of a marriage, a registered partnership or security rights, the assessment may be more extensive.
If a parent lent to the child’s business, check whether it was a sole proprietorship or a private limited company (bv). A sole proprietorship does not have separate legal personality in the way a bv does. A loan to a bv is in principle a claim against that bv. Holding the child personally liable then requires a separate legal basis, for example a validly given personal guarantee.
When can you call in the family loan?
An agreed repayment date or repayment schedule is the starting point. A family conflict does not automatically make a loan due earlier. If you agreed that repayment would take place on the sale of the home, that condition must be interpreted. Also check whether there are arrangements on early calling in of the loan in the event of arrears or other events.
If the agreement does not contain any other time for repayment, Article 7:129e of the Dutch Civil Code may mean that repayment must be made within six weeks of notice that the loan is being called in. For older agreements, the applicable law must be established. Moreover, the absence of a date in a document does not mean that no term was agreed orally.
An arrangement that a child will pay as soon as they are able to do so requires particular attention. Article 7:129f of the Dutch Civil Code allows the court to determine the moment at which the loan becomes due in the light of the circumstances. The financial situation may then be relevant. It is advisable to establish what type of arrangement was actually made before sending a letter of demand.
If repayments are not made
First calculate the correct balance. Set out the original advances, repayments received, agreed interest and any waivers separately in an overview. Avoid gifts being automatically recorded as repayments without checking what was agreed. Incorrect records can cloud a claim that is well-founded in itself.
Then send a factual letter setting out the payment arrears and the remedy requested. Check whether only the missed instalments or the entire loan is due. The consequence of a missed instalment must follow from the agreement or another legal basis. A rule you add yourself stating that everything immediately becomes payable is not automatically valid.
Ask the recipient to explain any dispute specifically. Is the existence of the loan being denied, is the dispute about the balance, or is only a temporary postponement being requested? Each response calls for a different approach. Where payment difficulties are acknowledged, an arrangement may be more effective than going straight to court, provided that your claim and the arrangements remain clear.
Reclaiming money after your child’s divorce or separation
A divorce or separation can bring to light a family loan that remained out of view for years. One ex-partner acknowledges the debt, the other calls it a gift. In that case, investigate who entered into the loan and what the money was used for. An acknowledgement by one person does not automatically bind every other person involved.
Documents relating to the mortgage financing may also be relevant. If a gift was declared to the mortgage lender while a loan was intended between the parties, that calls for careful assessment. Do not create new documents with an old date to make the situation fit after the event. Keep the original documents and have any inconsistencies explained.
The division between ex-partners and the parent’s claim are different questions. The parent may have rights under their own loan, while the ex-partners must settle between themselves who bears the burden. See also a joint loan after divorce and reclaiming money from an ex.
What happens if the lender dies?
An existing claim may form part of the lender’s estate. Death does not automatically mean that the child no longer has to pay the debt. However, the loan terms, a will, earlier waivers and the way in which the estate is administered may be relevant. It must also be established who is authorised to collect the claim.
If the borrower is also an heir, it does not simply follow that the debt disappears without being dealt with in the administration of the estate. The position of other heirs and creditors may play a role. Have any reliance on set-off or deduction from an inheritance share assessed within the framework of inheritance law. An expected inheritance is no licence to stop paying early.
For the purposes of evidence, an up-to-date balance confirmation and clear records are particularly valuable. An heir or executor may not have been present when the original arrangement was made. So record during the lender’s lifetime which amounts are outstanding and which gifts or waivers have already been made. This limits uncertainty without having to reconstruct the family history all over again.
Limitation also applies within the family
A good relationship does not automatically suspend statutory time limits. The limitation of a claim for repayment depends on factors such as when it became due, the nature of the arrangement and any acknowledgement or interruption. A loan without an end date calls for a different analysis from a loan with fixed monthly instalments.
Have the period calculated in good time. A written reminder or notice in which the right to performance is unambiguously reserved can, if the conditions are met, interrupt the limitation period. Keep proof of receipt. A friendly conversation in which the parties merely say they will talk further later does not always offer the same protection.
A periodic joint balance confirmation can help to prevent misunderstandings, but its legal significance depends on its content and context. Read more about limitation of a private loan. Have an old loan examined before concluding that the debt is definitely time-barred or, conversely, that it can still be claimed indefinitely.
Recording an arrangement without creating new uncertainty
If the parties want a solution, record the acknowledged balance and the payment obligation in specific terms. State whether the original agreement remains in force and which arrangements are being changed. Indicate whether interest continues to accrue, how repayments are processed and what the consequence of a missed payment is.
In the case of a partial waiver, it must be clear which amount lapses definitively and at what moment. In a settlement involving payment of a lower amount, it may for example be agreed that the discharge only takes effect once the settlement has been performed in full. Whether such an arrangement is appropriate depends on the situation. Also have the tax consequences taken into account separately.
A mediator can guide discussions where preserving the family relationship is important. A lawyer can assess the legal position and whether the arrangements are workable. Those roles are not the same. Discuss in advance who represents whose interests, and prevent one family member from thinking they are receiving independent advice while the adviser is acting for the other.
Recording annual gifts and repayments separately
In family financing, the parties sometimes agree that the parents will make an annual gift and that the child will use it to make repayments. The loan and the gift then remain separate arrangements. An intention to make gifts in the future is not in itself proof that the loan has been waived in full today.
Record for each year what actually happened. Was an amount given, received and repaid, or was part of the debt waived directly? Who carried out that act and which loan did it relate to? A short annual balance confirmation can prevent a great deal of later discussion.
Pay attention to the identity of the parties. A gift from one parent to the child is not automatically a payment by both parents to the child and his or her partner. In the event of a break-up or death, that difference may become relevant. The tax treatment must also match the actual arrangements and, where necessary, deserves separate advice.
For the civil-law settlement, what ultimately counts is which obligation remains after the demonstrable repayments and waivers have been processed. Avoid a calculation in which the same gift is counted both as a repayment and as a separate reduction. If in doubt, have the annual changes reconstructed before you claim or acknowledge a remaining amount.
Example of annual balance records
If there are both annual gifts and repayments, keep the two strictly separate. One short overview per year, signed by both parties, prevents most later disputes, including in the case of an estate.
| Year | Outstanding on 1 January | Gift (recorded separately) | Repaid | Interest paid | Outstanding on 31 December | Confirmed by both parties on |
|---|---|---|---|---|---|---|
| 2023 | € 40,000 | € 6,000 (gift letter 12-01-2023) | € 6,000 (transfer 15-01-2023) | € 800 | € 34,000 | 28-12-2023 |
| 2024 | € 34,000 | € 6,000 (gift letter 10-01-2024) | € 6,000 | € 680 | € 28,000 | 27-12-2024 |
| 2025 | € 28,000 | € 6,000 | € 6,000 | € 560 | € 22,000 | 29-12-2025 |
Have discussions within the family reached a deadlock? See how we handle loan disputes.
Frequently asked questions
Does a family loan have to be recorded by a civil-law notary?
Not every loan requires a notarial deed. An ordinary loan of money that has been made can also be proved in other ways. However, formal requirements apply to a right of mortgage over a home, including a notarial deed and registration. A civil-law notary can also help with how the loan fits with gifts and estate planning.
Is money from parents always a gift?
No. Parents can make gifts, lend money or combine different arrangements. The family relationship and the absence of interest do not automatically decide this. The repayment arrangement and the evidence for it are decisive. Also consider any subsequent waivers separately from the original advance.
Can I call in the loan because we have fallen out?
A quarrel is not in itself a general ground for immediately reclaiming a loan that is not yet due. The agreement determines when payment must be made, supplemented by the applicable statutory rules. Have it checked whether there is a ground for calling in the loan and which period you must observe.
Can an annual gift be set off against the repayment?
That depends on the arrangements and the applicable civil and tax rules. A gift and a repayment are different acts. Record clearly whether money is actually being paid, a debt is being waived or set-off is intended. A bookkeeping entry alone does not prevent every dispute.
My brother says our parent waived the loan: is that right?
Ask which statement or arrangement supports this and what amount it concerned. It is important to distinguish between a postponement, an intention to make a gift later and an actual waiver. Keep the original messages and documents. In the case of an estate, the authority of the people involved must also be established.
What if, as a family member, I am being held liable but did not borrow anything?
Ask for the agreement, proof of payment and an explanation of why you in particular are said to be the debtor. A payment to your partner or his or her business does not automatically make you liable. Respond specifically and in good time, especially to a summons. You can read more about this under disputing a claim for repayment.
Clarity about the family loan
Arslan Advocaten can help assess arrangements, evidence, whether the loan is due and possible defences. In doing so, we look at the position of the lender and that of the borrower being held liable, depending on whom we are assisting. Get in touch with the agreement, the payments and relevant messages. For a loan without a contract, our explanation of evidence helps you organise the documents in advance.
Written by Onur Arslan, attorney at Arslan Advocaten and responsible within the firm for the financial practice: credit registrations, loans of money and disputes with lenders. Registered in the specialisation register of the Netherlands Bar (Nederlandse orde van advocaten) for employment law and personal injury. Substantively reviewed on 12 September 2026 against the statutory text on wetten.overheid.nl.
