Trying to help pensioner with 50K debt - need some help and encouragement!

bosslady_2

hello there

I'm feeling extremely frustrated tonight and in need of a bit of support!

I am trying to help my partner's elderly mother set up a debt repayment plan. She owes just under 50K to banks in loans and credit cards, has been using the cards to pay her loans and hit the limit just after xmas.

This is a breakdown of what she owes:

Halifax Credit Card 11344 @ 19%
Frasercard 668 (sorry can't find the apr for this one, I only have some of her correspondance)
RBS Loan 17000 @ 9.5%
RBS Credit card 10761 (interest frozen at the moment)
M&S Credit Card 909 @ 15.9%
Halifax Loan 8100 (again no info on APR)
Halifax Overdraft 450

Using the templates at the National Debt Helpline I did a budget planner with her and worked out what she could actually afford to pay monthly (which ended up at about a fifth of the total minimum payments). She did go to CAB with her son (my partner) but she lives out in the sticks, there wasn't anyone who knew about arranging the debt repayment plans at the local office and the woman she did get to see apparently was very judgemental and made her feel even more ashamed than she does already. (Have to say at this point that my partner has been sorting his debt out through our local CAB and they were excellent)

At the moment she is arranging a power of attorney so her son can deal with the banks etc as she really hasn't a clue what the people at the call centres are on about. But til we get that sorted, we're stuck in limbo with some of the companies. We have reached some sort of agreement with RBS (card), m&s and Halifax Visa and RBS (card) has frozen the interest.

Our main problem has been with the two banks and the loans. In particular the Halifax. We have written to them 3 times and never heard anything back. At the end of Feb I wondered if the reason we hadn't heard anything was because they hadn't cancelled the standing order to the loan account (it's set up on her halifax current account) - they were getting the money for the loan so as far they were concerned there was no problem. Of course this left her with no money to pay her other creditors and so broke the agreements we had managed to make! I got her to phone telephone banking to cancel it but they refused to do it and transferred her to another dept who also refused to do it and transferred her to collections who said they couldn't cancel it but that the first person we spoke to could! AAAAARGHHHH! Each person she spoke to was only interested in trying to sell her a secured loan and would do nothing to actually try and help. I've written a letter to try and cancel the STO now but she won't phone to find out if it's cancelled as she finds the whole situation distressing.

Has anyone else had this problem? How on earth do you get the bank to stop taking the payments? Also the collections guy said (by this point my partner was speaking to him) that they would not deal with his mum personally but only through CAB, basically they would do nothing with the loan account and just let it continue as normal unless a 3rd party got involved. Surely this isn't right ...

Her loan payment is due to come out on friday and there is no money in the account so she'll be hit with charges, which will just spiral out of control. The cynical part of me thinks this is all deliberate to get more money out of her.

I've really rambled for far too long but Just wanted to sound off and hopefully get some advice ... I really want to be able to help her out as she has been so lovely to me.

Thanks for listening.

PS: Some of the stories of people getting themselves sorted out are really inspiring. Well done!

KatrinaC_2

Can a bank refuse to cancel a standing order?

I thought that as they are set up at your request that you were able to cancel them. It's up to you to make the payment by whichever means you choose, surely the bank is at least morally wrong to act like this.

Kat

shazzer22

Hi, I'm afraid i havent got much advice but thought i would let you know you're not alone, i've been attempting to (with the help of my local cab) to sort out my 73 year old fathers debt problems (only £7k but difficult enough!) My mum left him 9 months ago leaving him in mountains of cc debt he didnt even know about!

It is an uphill struggle, especially as companies have to be so careful about who they discuss account info with, when you have power of attorney it is much simpler!

There will be lots of people along soon to help i'm sure!

Is there a mortgage to be paid at all? Are there any outstanding debts to utility companies/ council tax etc?

bosslady_2

It's what they term an 'HPP' - not sure what that stands for. It's basically an internal standing order that the bank sets up. They should be able to cancel it but won't (so far). We are going to see her tomorrow and I think we should go into a branch as the staff are generally a bit more human in branches.
Morally wrong? Yes I think so. But do they really care?

bosslady_2

She has a mortgage to pay too. Not sure what is outstanding. She pays £200 a month to that. I know she remortgaged a few years ago after having paid it off to help my partner out (as he had a stack load of debt at the time) so he feels responsible for a lot of it. To be honest he's not really well enough to deal with all this as he's just recovering from a serious bout of depression (not helped by the debts).

THE_LONE_RANGER_4

basically cancell standing order ie no money cant pay post soa and let us sort it out for you reguards andrew

bosslady_2

thanks to everyone who's posted!
we'll give it one last go tomorrow at the branch.
I should also have mentioned that she's had default notices for everything (except the halifax loan) too.
Cross your fingers for me! If the account goes overdrawn, there'll be even more work to do!

CLAPTON

if your mother's bank a/c is with the halifax and so are some of her loans, they are allowed to take money from her current a/c to pay her halifax loans.

she/you must open another current a/c with a bank that she owes no money to and make sure her income goes into the new bank a/c ... only then will she/you have control of her money.

bosslady_2

her a/c is with halifax but there is no money left in it.
we've transferred her pension across to another bank account already but i still fear they will just keep taking funds that aren't there and push her into an unauthorised o/d.

bosslady_2

OK here's the SOA:

Income:
Two pensions totalling 977.33

Expenditure:
Mortgage: 204.53
Overdraft Cost: 2.47
Building and Contents Insurance: 23.85
Courtyard fee: 8
Council Tax 95
Gas Bill 45.50
Electricity 20
Home phone 25
Gas / plumbing cover 14
Transport (petrol / MOT / tax etc): 150
Newspapers: 32.48
Food bill 125

Surplus of 231.50

I've asked her to make a list of other costs as I've just done these from her bank statements over the last year. So there's a monthly haircut, clothes, mobile and I thought it would be a good idea to put aside money for birthdays / xmas as a fair amount of the credit card debt has been down to overspending on her grandchildren after the parents split up. So I've guessed the rest comes to roughly £100 plus there could be things I've missed. I'll get her to do a spending diary for the month.

So we have £130 to split between the creditors to pay off a 50K debt. EEK!
However, my partner did say that it took forever for his creditors to agree when he did this a few years ago and his debt was comparatively tiny (7K) so I'm guessing these companies just don't like to make it easy for you.

skintchick

SHe could spend less on food - that's a lot for one person. Cut the phone down too. And the newspapers.

Her buildings and contents looks very high also - I paid £120 with CIS for a two bed terrace. Shop around and swap to another provider.

Gas and leccy also look highish, although I appreciate she is old and they get cold.

I'd also query the gas cover and the car running costs - does she really need to spend that much on a car?

When my Grandad got doddery (we wanted him to stop driving), we worked out he would be better off getting taxis to his club and the shops instead of running a car. Do a few calculations and see.
HTH