Can you help me help my mum?

squibbs25

This is a long one, so i apologise in advance .

I spoke to my mum yesterday who was very subdued, i finally got her to talk to me about what was bothering her.
It turns out she is debt, not by a little bit but by loads.
She owes money here there and just about everywhere.
I want to help her but dont know where to start.
She has 5 credit cards (that are all max'd out on the limit). One of the companies is giving her a hard time. They have charged a late payment fee (which they are entitled to do) which has caused her to go over her credit limit, to which they are fining/charging her for, which again is taking her over the credit limit, therefore they are going round in circles. She can't afford to pay what she owe's so adding more fee's isn't really helping the matter.

I have arranged for mum to come round to me on Wednesday so we can try and sort through her finances.

Where do i start?
I know i have to have an incoming list and an out going list, but once i've dont that, then where do i go from there.
Neither my mum or step-dad work. Step-dad's disabled , mum's his carer.
Mum now recieve's state pension, not sure about step-dad. He used to get IS. I know he gets DLA.
When sorting the incoming oney side of things do i include the DLA as it is awarded to him not my mum, all the debts are in her name.

Please can anyone help where i go from here?

Thanks for listening.

Squibbs

Merlot

Squibbs, I posted on your other thread, have you seen it?

baccyman

i am not clued up on these things but i would try getting in touch with the credit card company's and see if you can get them to stop the interest charges that they are putting on this will stop the debt getting bigger,
hope that will help.

Merlot

Squibbs, i see that you have thanked me for the link to CCCS, I think you need to get your mother to do an SOA (incomings and outgoings) and come back here with it/or contact the CCCS, they will advise you, but without the SOA and detail of the debt, there is little we can advise at the moment, it doesn't mean we can't help you, but we can't offer you any real useful advice without the SOA.

Merlot.x.

p.s. I want to offer you my condolences, just noticed "Molly":grouphug:

poorandindenial

Hi Squibbs

Here is a link to an SOA calculator

http://www.makesenseofcards.com/soacalc.html

If your mum could pull this info together it will make it easier for her to get help. I saw that Merlot pointed you to CCCS and a pre-populated SOA will help when she speaks to them.

There are other not-for-profit debt charities here but CCCS has an online tool that helps you understand what your options are.

squibbs25

I am going to attempt a SOA on Wednesday.
I will post more as soon as i get the info.
Thank you so far.
Squibbs x

squibbs25

Here goes....................
Got mum and stepdad to sit with me and write a list of all their debts.
The list is quite scarey. I've totalled it up and in credit cards they owe £18k :eek: ,that figure doesn't include either of the loans. (one finishes in sept the other Nov 2011)

Incoming: mum's state pension £68.86 pw
stepdad pension £148.24 pw
stepdad DLA £436.00 every 4 weeks (though this will reduce for car allowance)

What do i do now?

Before i commit them to anything, stepdad is waiting on a mobility car, if they were to enter an IVA would that hinder him getting the car. It has just been ordered and they have an approx 11 week wait.
Also does anyone know if his DLA is counted as an income when working out the IVA. Obviously his DLA will drop when he gets the car, but they will have slightly more money than they have now as they wont be paying the loan, car insurance or breakdown.

I've showed them that where they are only able to pay min payments on all the bills they are actually paying over £250 a month purely on interest, while only paying a few pounds of the actual bill.

They've got into the situation where money was tight and as the billls started to come in, they have paid them with a credit card - now they are maxed out on all the cards and still have little money.
The 'normal' living expenses come to 450 pm (gas./elec/water/food/petrol/house insurance/car insurance/tv lic/sky/broadband/car breakdown- they dont pay rent or council tax)

They really want to get this sorted out.

Where do i go from here? If the loans are added i think they must total nearly another 10K.
Is it worth them declaring themselves bankrupt? I just dont see how they will be able to pay back so much money with so little coming in.
I have talked to them at length and expalined that it is not the debt that is the problem but the spending.

The one reservation mum does have is the doing anything before the mobility car is delivered :rolleyes:

Any advice greatly appreciated.

Squibbs

fermi

A motabilty car is not touched even if they go bankrupt, and I know people who have sorted one out after doing just that.

Why an IVA? Is there equity in their home to protect?

Have they spoken to CCCS, or have you/they used the CCCS Debt Remedy to see what it suggests?

squibbs25

They live in a Housing Association home.

fermi

I don't see any benefit to doing an IVA then, and to be honest I'm not really sure if one would even be possible.

I really think that they/you need to talk to a professional and impartial debt advisor ASAP, so that their options can be discussed.

The places to seek that advice are in my signature or here: Non-profit Debt Counsellors' List

squibbs25

I thought anyone could do an IVA, does it only apply to people with homes / equity then?

If that's the case, are there any other options available to them.
Their house was repossed back in 1999 (hense the bank loan)