How can I help him?

milliejon

My brother in law is at a point where he needs to do something about his debt, but won't talk about it.

He owns a small business, which is not doing very well. This means that he's not drawing a wage, which then means that he's not paying his bills or bringing his personal overdraft down.

He's receiving phone calls asking for money to go into his bank accounts. He has a pile of letters that he hasn't opened.

I know where his head is (mine was there at some point in the dim distant past) but he needs encouragement to make some moves to change things. He's seen me go through depression and then sort out a DMP for myself, and he needs to at least do that.

I've touched on this with him, but he won't talk about things. He's worried that if his personal money is in trouble then the business will be affected. The difficulty is that his mum's house is used as the collatoral (?right word) for the business. He lives with his mum, so can't hide the unopened letters and phone calls etc. She's a pensioner, and is really worried about things.

What can I do to encourage him to see his lightbulb? Will his personal money problems have an effect on the business?

Any advice is really welcome.

Ryan_Taylor

Unfortunately, I've found that you really can't help someone until they help themselves. If you try to talk to him about it, he'll probably clam up because he's ashamed or not seeing reality.

Maybe recommend him to visit the forums here or some blogs.

Best of luck!

bargainbetty

If the house is collateral, then it is at risk. His mum has a right to know what is happening with her own home.

His personal finances will affect his business, because if his personal credit rating is shot, then any business where he is a director will find it difficult to obtain credit or certain accounts.

He needs to sort it out, but you can't help him until he deals with it. You could offer to sit with him and go through the letters..... so he doesn't feel alone?

Good luck x

milliejon

Thanks both. I took the bull by the horns (so to speak) and encouraged him to open the letters. We both sat down, sorted through them and went through the bank accounts. It was nowhere near as bad as he thought. Although he had debts, he coping with paying them. His difficulty has started because DDs are going out when he doesn't have cash in the account because he doesn't have a regular wage.

His mum knows everything.

And, he went to the bank today, and they've increased his overdraft temporarily.

I'll make sure that I keep at it with him.

Thanks again.

edinburgher

Good stuff milliejon - I'm sure he's got a relative who's happy to offer support and help him take the all important first steps to sorting things out

milliejon

I need some more advice and help please.....

A couple of months have passed since we sat down and opened the letters, but things are now worse.

His personal bank account is now at £1000 over his overdraft which means that he's still getting charges for his two loans with the same bank are being drawn (he has another pile of envelopes to open).

He is in the process of opening a new simple bank account to pay his wages into. Also, because he can't guarantee a monthly wage, he's stopped his direct debits so that he can pay with cash.

We have spoken about trying to reclaim his bank charges but I have a concern about this, because his personal bank is the same bank as he uses for business. I suspect that the accounts will be linked - does anyone know for sure?

Because he doesn't have a regular wage, I suggested writing to the companies to ask them to hold action whilst he's sorting things out, but again two of these are the loans with the bank.

He seems to think that once he's paid back the money he owes the bank to bring the account back in under the overdraft limit, everything will be OK - but I suspect they won't because he doesn't have a wage coming in.

Does anyone have any comments on the way forward or any advice at all?

We've managed to get his mum to look after the children on Sunday, so he's coming here with his paperwork (and unopened envelopes) so we can see exactly what is going on.

There is an added complication in that he wants to speak to somebody at the bank - face-to-face, but can't and the call centre isn't in this country and he finds it difficult to speak with operator there.

I'd really welcome your advice.

milliejon

Is there anyone who can help or advise please?

RAS

bumping this but really he needs to talk both to the national debtline and the Busines debt line. A lot depends how much debt he is in but you will not know that until you have done the sums. You need to know what account is secured on mum's house.

GeorgeUK

I agree with Ras. Business Debtline should be one of the main people to call. They will be able to tell him if his business account and personal account will be kept entirely seperate or not.

If they are then he will need to be able to guarantee a payment to his creditors which will mean at least a minimum wage that the business pays him or he will really struggle to sort this out. If he can manage this then he should deal with it on the basis of how much income/expenditure/debt he has and make offers of payment to his creditors based on the basic wage. This is the way i would do it but don't know if that is an option.

milliejon

Thanks both. I hadn't realised that there is a Business Debtline. I'll have a look around there when we have all the figures. I fear the worst though ........

RAS

Contacts nicked from tiger

CCCS 0800 138 1111 National Debtline 0808 808 4000 Business Debt Line 0800 197 6026 CAB – Contact your local office and ask to speak to a Specialist Financial Advisor. Insolvency Service- 0845 602 9848