Help me set Maw up for another 67 years of financial well-being

Mutant — Tue, 25 Jul 2006 06:32:14 -0800

Forgiving or otherwise reducing Maw's debts? As a followup to this question, I've arrived at an effective financial mechanism to help me provide for Maw, however while evaluating her overall financial health I learned that she's acquired alarming (given her previous state of relatively low income) debts.

Specifically, at 67 years of age she's never earned more than $18K, but somehow has managed to convince three lenders to front her some $20K in debt. I believe most of this is unsecured, but I haven't seen all the paperwork yet and as a further indication of Maw's lack of financial knowledge she has no idea herself. My current activities have been focused on migrating higher interest rate debt into lower rate facilities, but the final outcome is unsatisfactory even if I can get all of her debts into a secured vehicle.

Clearly it doesn't make any sense for me to be supporting Maw if over one third of her current source of income (Social Security) is absorbed by debt service. I work in banking and just by looking at her age (not to mention low income) consider this an example of irresponsible lending, so what are the options here for debt relief / forgiveness or outright bankruptcy?

Can I negotiate on her behalf? I suspect she'd have to appoint me her financial guardian (of sorts, not sure what this is really called in practise, I'm just aware of the term from BSchool), otherwise these folks won't talk to me. If I do undertake negotiations on her behalf, I'd want to know what my ultimate fall back is so I can play hardball, so does this strike any of you as a clear cut case for bankruptcy?

I've been living in the UK full time since 1998 and for about one year before that I divided my time between New York and London, so I'm more than a little in the dark on these matters back in the US. Any ideas on the path of least resistance? Are these debt counseling services really worthwhile engaging?

I'm not adverse to personally paying off her debts if we could get them reduced somewhat. If this negatively impacts her credit, all the better from my viewpoint as she can't hold onto money. Any suggestions for helping Maw weather another 67 years in improved financial help welcomed.

Deck Chairs, the Titanic, and Me

scaryblackdeath — Mon, 01 May 2006 08:05:32 -0800

What actually happens when one goes through credit counseling and/or debt consolidation? I'm in an ugly mess and I'm scared--everyone tells me it's not that bad, but that's only in comparison to horror stories. I see that it's not getting better anytime soon. Details inside--any practical advice is appreciated! I'm looking at $15k in credit card debt. Some of this was probably unavoidable. Some of it was me stupidly living beyond my means. Every time in the last two years I've thought things would improve, they don't. I don't make much money; I can say that will improve someday in the next couple years, but I couldn't say precisely when.

At the moment, I have pretty good credit. My debts look like they may soon be outside of my ability to pay. I'm also looking at the potential for seasonal unemployment for a couple months here (I substitute teach), and while I'm looking hard for something to cover that, I'm concerned about the worst-case-scenario.

About a month & a half ago, I goofed up and failed to make a credit card payment (first time ever, I simply thought it was done when it wasn't) and now I've been nailed with a 30.34% APR on that $6500 balance. I already asked if there was any way to change that back, and the card company said no. Obviously it's time to roll that over to someplace else.

The other credit card is nearing $8k, and I've got a remaining $500 on a Firestone card... with all this together, I've decided to just go for counseling and/or consolidation.

The service I called sent me a budgeting sheet and asked me to have that ready when the counselor calls me in a couple days. Clearly I need to tighten my belt and engage in more disciplined living, but somehow that alone doesn't sound like it'll make everything better.

What can I reasonably expect? I've heard of people having debts reduced and/or eliminated, but that sounds like a pipe dream and it's usually in regards to people in worse situations than mine. Much as I wish someone would wave a magic wand and make my debts go away, I doubt that's gonna happen.

Oh. And I'm horribly embarrassed by all this, because I used to think I'm a responsible person. Duh.

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Help me set Maw up for another 67 years of financial well-being

Deck Chairs, the Titanic, and Me