A difficult situation. Without knowing all the facts, I can see your husband’s point of view.
Assuming your brother has been working a while, and isn’t on minimum wage, not having any rainy day savings beyond the redundancy cheque seems a bit reckless. If that’s his approach to his finances, it seems there’s a fair chance any loan won’t be paid back, certainly not for a long time. He will have made choices along the way of the size of house he’s renting or bought, car he drives, holidays, spending etc, all of which have culminated in the current stressed financial situation. So it’s a really unfortunate position, but plenty of people, even on quite modest incomes, plan their finances to protect them if they lose their jobs in a recession.
Search any message board and you’ll definitely find similar situations, but five years down the line, where families have fallen out irreparably over these sorts of loans. The initial generosity can easily slip into resentment if money isn’t repaid or the terms of repayment drift. Your husband is right to be cautious of the chances of a falling out.
If you go ahead, I suggest you talk through the second order consequences. When and how quickly is it paid back? It might seem excessive but draft a simple legal document for the loan. You may never actually enforce it but it ensures everyone has agreed the parameters.
Ask is you would feel upset if in a years time he’s paying for a holiday before paying you back? If so, what if it’s a week in the Maldives rather than a caravan holiday in wales. This may sound flippant, but it’s exactly the sort of thing that causes falling outs later on. Your brothers family mat have different priorities to yours, and his idea of necessity maybe your idea of indulgence. On a more mundane level, what if he keeps buying a £3 flat white every morning which out of work, while having your loan. That might not bother some people, but might really grate with others. So have the uncomfortable conversations now.
Then think about your own family finances. How would feel if you or your husband see a reduction in income in the coming recession, and it affected a major decision for your family, such as opportunity for children or dealing with an unexpected health problem. At very least make sure you’ve got plenty of rainy day savings, and clearly mentally write the loan off as a gift.
Finally, one thing your husband might be worried about but not saying is whether it’s fair to his side of the family. Assuming you pool your finances, does a loan (especially a loan that doesn’t get repaid) leave him unable to make a similar gesture to his side of the family. If so, and your family finances are really strong, perhaps suggest he can make an equal loan/gift to his parents/sibling so it feels more equitable.
None of this takes away from a really tricky situation. The natural human instinct is to want to help family. Hope your brother finds a job soon.