posted this on th bk forum but not sure if that was the right place can anyone help?

[Anonymous]

So my mother lives independently in low income housing for seniors. She has always done her own finances, and every now and then we have needed to send her money for groceries etc.. over the past few months she has needed our help more and more. Last night she called me in tears asking telling me she couldn't handle her finances anymore, and wants me to be her payee and take care of it for her. She was in tears because she bounced 2 one dollar checks at her bank and this has left her no money for food. She listed off her bills to me and what she owes and I see exactly why she cant make ends meet. She receives a fixed amount of money social security is her only income and it is $694.00 per month and food stamps of 30.00/mo. She has been buying things on credit at places like swiss colony, Ginnys, woman within etc... she also opened a credit card and has maxed it out. Even with the minimum payments made every month (and she always makes sure she does pay them) she cannot survive on whats left over for groceries etc..... her debt totals around 3200.00 by my calculations, not counting an old student loan thats $30.00/month. She can't continue this way........I am trying to figure out what would be in her best interest to do at this point......She doesn't own a car or a home or have a savings account so there is really nothing that a creditor could take from her, as I have read that SS can't be garnished. She does have good credit, because she would pay her bills before she would eat.....Can anyone think of any options out there for me to consider?

I  will be going this weekend and paying the bank overdrafts, and buying her groceries....but I don't know what to do long term. these are the options I have thought of:

1) she could obtain a debt consolidation loan, and make one hopefully lower payment every month? but would she even qualify with no coladeral, and low income?

2) A loan from me to get her back on her feet BUT I really only have 1000.00 I could spare to help her right now, without getting into our savings that we never ever touch, and I have a family of 5 to support it makes me weary to do this with the way the economy is.

3) call the companies and try to get them to settle for less

4) call the companies and tell them she can only pay you x amount per month and that is it.

5) Bankruptcy- hate to even think that, I know she wont need to obtain credit probably ever again, but it seems like such a small amount to file over and I know nothing about how it works or what it costs....

6) Pay her basic needs such as rent, food, doctor etc.. and the creditors just get what the get?

Any ideas? I have to figure something out for her asap!

[jackg]

fiveinall,

I'm certain this situation has you very upset and perhaps a 3rd party opinion is needed here. I'm sure you will get plenty of advice here and I can share my opinion with you.

1) she could obtain a debt consolidation loan, and make one hopefully lower payment every month? but would she even qualify with no coladeral, and low income?

I agree, she most likely won't qualify

2) A loan from me to get her back on her feet BUT I really only have 1000.00 I could spare to help her right now, without getting into our savings that we never ever touch, and I have a family of 5 to support it makes me weary to do this with the way the economy is.

$1,000 should give some relief so you can figure out lon term solution

3) call the companies and try to get them to settle for less

You may need Power of Atty. in order to do this but I think it's worthwhile.

4) call the companies and tell them she can only pay you x amount per month and that is it.

Same as #3

5) Bankruptcy- hate to even think that, I know she wont need to obtain credit probably ever again, but it seems like such a small amount to file over and I know nothing about how it works or what it costs.

This is the most likely long term solution. Contact a BK attorney, you want a CH 7 BK if she can qualify. I think she will. I filed in 2006 in Michigan and it cost me $1,400 but I've heard now it's about $2,000 now but the attorneys do offer a payment plan.

.

6) Pay her basic needs such as rent, food, doctor etc.. and the creditors just get what the get?

Definitely her needs have the highest priority, the CCC's get what's left over.

Any ideas? I have to figure something out for her asap!

Good luck to you and your Mother

[Jazzzy]

One thing you may want to do is see if there is an agency for the elderly that can help her manage or give her adivce. Call the Dept. of Social Services (or whatever it may be called in her county) and ask for their advice on agencies that may be able to help. She may be able to get someone who helps her manage her credit, gives education, etc. Check out AARP. There are services out there for the elderly.

I would think that under these circumstances she may be able to have her school loan deferred. That is one less payment right now.

You are in a tough situation. Talking to her creditors can't hurt, and there may be a way out of this shy of BK.