Shocked by the advice my mum got at the CAB...

CLAPTON

You need to post an SOA for her.

RAS

PM

Your mum is trying to have her cake and eat it. Sadly that is not an option.

Since she has run up these debts, she either pays them back or she will start getting letters to tell her that she is in trouble.

The CAB lady was right in that the last thing your mother should be doing is borrowing more money so she can keep up with credit repayments, even from her brother. If someone has no income, then that is the standard advice.

However, because she has a house in the UK, the creditors can still take action against her estate if not her.

Even if she pays reduced payments to the creditors, they will default her accounts and either take legal action or sell them on to debt collectors. Both tend to check out if there is any equity owned by the debtor and so the chances are they will try for CCJs and then charging orders. Obviously this affects her credit rating and she will have to pay off any charging orders when she sells the house.

Is she charging you the going rate for the rent? If not, would it be better for you to move into accomodation elsewhere so she can get the full rental value, and have more to repay each month?

Daffykjs

I'm not sure if this is not an option for some reason. But if your rent is just covering the mortgage and bills and she gets nothing extra can you not take over the mortgage so you own it yourself? Does it help her that she 'owns' here or is that making things even more complicated?

I'm not sure what to suggest but the CAB advice doesn't sound too helpful. I think she'll have to try ringing or getting a call back from nationaldebtline, payplan or cccs when she's back in turkey. not ideal coz i'm sure she wanted to get it sorted whilst here but i don't think she can leave it just like that!

hope she gets it sorted!

lxpeanut

purplemoon wrote: »

As the interest rates are going down at the moment on her mortgage she could pay some towards the debt, but it would make only a small dent on the interest.

I think it would be best if she uses this money to make token payments to creditors. But this only works if she can see her situation improving in near furute. Explain the situation and offer payment (in writing) some creditors will accept this and allow a short payment break others wont. Either way she needs to pay only what she's offered them. Once she has an income then she needs to arrainge a debt management plan and increase the payments to pay off the debt. Unfortunatly this still effects her credit rating but it will have less effect than just not paying.

Her only other options as far as I can see are to increase her income or apply for bankruptcy.

purplemoon

RAS wrote: »

PM

Your mum is trying to have her cake and eat it. Sadly that is not an option.

Since she has run up these debts, she either pays them back or she will start getting letters to tell her that she is in trouble.

Phew, there I was trying to encourage her to post here! I now think not. MSE has become a tough old place in its old age. She wants to repay her debts. It was the woman at the CAB who advised her not to. We know that it will be against her estate. She does get the market rate in rent BTW.

purplemoon

lxpeanut wrote: »

I think it would be best if she uses this money to make token payments to creditors. But this only works if she can see her situation improving in near furute. Explain the situation and offer payment (in writing) some creditors will accept this and allow a short payment break others wont. Either way she needs to pay only what she's offered them. Once she has an income then she needs to arrainge a debt management plan and increase the payments to pay off the debt. Unfortunatly this still effects her credit rating but it will have less effect than just not paying.
.

This makes more sense. She does see it improving (Freehold and flat sale, plus a pension in January and work in Turkey).

FWIW, nominally they are loans from her brother but wealthy and awaiting a 1M plus house sale (not a good time for selling) in which case he'll likey write it off.

Jaggers_2

purplemoon wrote: »

She is enjoying living in Turkey now and does want to make money out there too. She is also trying to sell a flat there and has a Freehold here to sell. Within a year she will be able to claim a state pension.

She gave all of the above info to the CAB. She got legal aid in order to see the woman there so I am guessing that means she WAS a 'specialist'- that and her saying so that is!

Today she is re-arranging her stuff in storage (moving it to somewhere cheaper) and has no more 'working days' here. She hopes to continue business stuff from Turkey as she now has the internet and landline there.

Hold on, I'm confused. Your mum has a flat in Turkey that she is trying to sell and a freehold here? I assume this freehold is not the property you live in? So once they are sold why not use this to repay the debt?

Why would your mum get legal aid? As far as I'm aware this is not used for debt counselling.

You state that your mum wishes to continue business stuff in Turkey. Is this paid business or personal affairs? If the former she must be getting remuneration for it?

It appears to me that your mum should look to realise her assets to pay back these debts.

rog2

In a way, and whilst I do not condone it, I find myself erring towards agreeing with the 'advice' given by CAB. After all, if she hasn't got it - how can she pay it?
As far as I am aware, there is no arrangement between the UK and Turkey for the recovery of UK consumer debt. Any court action (ccjs) taken against her, including the ultimate of creditor petitioned bankruptcy, would only be enforceable in the UK and even if a Debt Collection Agency chased her to Turkey, all they could do is ask her if she wants to make any payment - they would not have any power to pursue a UK debt through the Turkish Courts.
That said, if she has equity in the UK house a creditor could apply for a charging order on the house. Such orders continue to incur interest and could, very quickly, increase to more than the value of her equity.

The question, for me, is - what would your mum like to do?

She can make offers of reduced payments, but that would depend on her having the funds to make the reduced payments - which she clearly doesn't have at the moment, so the 'sticking point' appears to remain the UK house, and I think that her creditors would 'go for the jugular' and try to get her to release her equity, or sell the house to pay them.

I'm honestly not sure what to reccomend for the best, pm. Perhaps she can look at the National Debtline website - www.nationaldebtline.co.uk/england_wales/debt_advice.php

And please don't misinterpret the advice already given. Without more details it is, indeed, difficult to advise, and the advice already given is probably the best under the circumstances.

We're not a 'tough old place' - honestly, and if your mum were to post here, we would do our est to help her.

purplemoon

Jaggers wrote: »

Hold on, I'm confused. Your mum has a flat in Turkey that she is trying to sell and a freehold here? I assume this freehold is not the property you live in? So once they are sold why not use this to repay the debt?

Why would your mum get legal aid? As far as I'm aware this is not used for debt counselling.

Yes to the first question. The flat has been difficult to sell, and the freehold needs work on it- and the people living in the building need to be in a position to take it on.

Oh, and its personal business (ie sorting this out!).

No idea re the 'legal aid'. They def told her that was it.

purplemoon

rog2 wrote: »

We're not a 'tough old place' - honestly, and if your mum were to post here, we would do our est to help her.

I may not be a mega poster but I have been around here a few years and I don't neccesarily find it that friendly any more TBH. In particular the statement about my mum 'having her cake and eating it' by RAS.... I found that totally bizzare given that she is the one wanting to make payments within her limited means and the CAB are the ones saying just forget it.

She would like to pay small amounts to pay off her debts. She gave away *a lot* of money and it is very important to her to keep this house for her grandchildren to live in.

I think someone suggested earlier that the house go in my name..? I am not in a position to do that currently.