Like a car crash in slow motion, a petition for help

betty_l8_than_eva

I'm trying to help a family member who has lost control of their debts, and looking for advice on how to begin untangling this mess.

Their situation is that they're suffering from mental health issues pre-covid, but has rapidly deteriorated in the past 6 months or so. We're finally getting them help on that part, but there's the also the trail of self-destruction that they've created as a result. I'll get straight into the debt issues (that we know of):

1). Rental property - didn't rent out the property for over 18 months, fell into arrears with the mortgage - bank instructed receivership company and has been sold at auction (house as asset under ltd company)
2). £5000 council tax bill that's at the enforcement stage with a 3rd party enforcement agent - out of the 5 outcomes (if the debt is not repaid), only 2 are possible - forced bankruptcy or upto 90 days prison sentence
3). DVLA - £80+ - this appears to be a fine due to the car being used whilst being SORN. I'm unsure of the additional debts/charges, as the family member claims the car was stolen, but other family members tell me they abandoned it. Feels more like a loose end, as we think the car has been scrapped (not on the MOT site).
4). £15k debt with Moorcroft for a credit card - debt letter sent and offer of coming to an arrangement if they get in contact.

And this is only the debts we've seen written confirmation of. What makes this situation even more difficult, is that my family member is so strong willed/stubborn that they have consistently been unwilling to seek help regarding their financial situation from both friends and family members. We're talking about someone who previously worked in business and finance for about 15years (but been out of a job for around 3 years) pressing the self destruction button on themselves and any hope of future job prospects. The mental capacity to manage their financial affairs is clear to see from the outside, yet they are so adamant that they are dealing with the situation.

As a concerned family member, where should I start?

capuchin

Edit: Others will probably have better advice especially specifically on the debt handling, but I felt it best to reach out and give some sort of response instead of none.

Contact council crisis team on his behalf for an assessment. It needs professional intervention. There are things that can be done (like a retrospective council tax exemption) but the bar is very high for obvious reasons.

I suspect the council tax is the priority thing here. The enforcement agents will need contacted by him/on his behalf by yourselves to state how vulnerable he is, which I believe gives them a statutory duty of care to inform the council. Combined with the above he may be able to get breathing space.

Moorcroft can be ignored currently. Somebody else will give better advice on this. You might just want to pay the DVLA one directly on his behalf as its such a low amount.

It's daunting but the relevant teams aren't new to this. They'll know how to handle it.

mcpitman

Any funds left remaining when the rental property was sold?

EssexHebridean

Hey OP - another one here with probably little that is constructive to add but not wanting to read & run. 

My question on the repossessed property is from a different angle to the one above - is there still anything outstanding as owing on this? If so then that will be another debt to note, although it will of course now be low priority as it will not be secured any more.

In terms of the current day-to-day - are you able to check that your relative's current priority bills are being covered? So rent/mortgage, Council Tax (not including the arrears you know about but just the current year's bill), water bills, and heating/lighting. Are they buying adequate groceries to keep themselves fed properly? 

On the car - can you establish whether a report of theft was made to the police, and of so is there a crime number anywhere? Although technically it should have been reported as no longer in the former's keeper's care at that stage, at least that would show that your relative didn't have the vehicle at the point the fine was raised, and in the circumstances the DVLA might cancel that fine. 

enthusiasticsaver

betty_l8_than_eva said:

I'm trying to help a family member who has lost control of their debts, and looking for advice on how to begin untangling this mess.

Their situation is that they're suffering from mental health issues pre-covid, but has rapidly deteriorated in the past 6 months or so. We're finally getting them help on that part, but there's the also the trail of self-destruction that they've created as a result. I'll get straight into the debt issues (that we know of):

1). Rental property - didn't rent out the property for over 18 months, fell into arrears with the mortgage - bank instructed receivership company and has been sold at auction (house as asset under ltd company)
2). £5000 council tax bill that's at the enforcement stage with a 3rd party enforcement agent - out of the 5 outcomes (if the debt is not repaid), only 2 are possible - forced bankruptcy or upto 90 days prison sentence
3). DVLA - £80+ - this appears to be a fine due to the car being used whilst being SORN. I'm unsure of the additional debts/charges, as the family member claims the car was stolen, but other family members tell me they abandoned it. Feels more like a loose end, as we think the car has been scrapped (not on the MOT site).
4). £15k debt with Moorcroft for a credit card - debt letter sent and offer of coming to an arrangement if they get in contact.

And this is only the debts we've seen written confirmation of. What makes this situation even more difficult, is that my family member is so strong willed/stubborn that they have consistently been unwilling to seek help regarding their financial situation from both friends and family members. We're talking about someone who previously worked in business and finance for about 15years (but been out of a job for around 3 years) pressing the self destruction button on themselves and any hope of future job prospects. The mental capacity to manage their financial affairs is clear to see from the outside, yet they are so adamant that they are dealing with the situation.

As a concerned family member, where should I start?

Your biggest problem is getting your family member to accept help if they are stubborn and strong willed.  The most urgent issue is the council tax so will they let you ring and discuss that and make the LA aware of the mental health problems your relative has at the moment?  

Finding out the extent of any outstanding debt on the now sold property or the DVLA fine may be helpful but I guess if the relative is unable to pay there is no urgency with that or the Moorcroft debt.  As you say though there is an urgency with the council tax.  If they force bankruptcy does the relative own any other assets like a house or investments? 

sourcrates

Sorry, but assuming this person has capability to make their own decisions, then non of this is any of your business.

You can only help if they give you there written consent to do so, otherwise its up to them to deal with it.

Data protection is not just a word, you cannot act for someone unless you have their authority to do so, get that, then we will talk.

capuchin

Just to add, insofar as the advice I gave. Family members and friends can and do intervene on the behalf of vulnerable people (It happened with me, and if it hadn't, I wouldn't be typing this today.) Every council (to my knowledge - it could be different in very rural areas) has a CMHT and EDT who can and should be contacted in this sort of situation. This is where you should be turning, not to the GP, who can only refer to primary teams.

They see these situations all the time, and likely the vast majority aren't reported by the person themselves. The crux of this issue is his impaired capacity to deal with the issues, and the family absolutely can and should address that. 

@sourcrates is of course correct with regards to the debts, but that is a symptom of the issues. The relevant teams have the powers to stop a lot of this in its tracks, but you need to be persistent and not bounced around PCT's.

EssexHebridean

Absolutely agree with Capuchin - support from family members and even close friends can be vital to someone who is essentially in crisis but doesn't realise it. You cannot physically step in and deal with the debts directly, but it is possible to put pathways in place to ensure that the person is being supported by the correct agencies - that then gives them agency to either seek help, or to deal with the situation themselves.