How to Get Out of Debt With the Get Out of Debt Guy » death

My Husband Died. How Can I Get Creditors to Stop Calling Me?

Consumer — Sat, 14 Apr 2012 19:47:58 +0000

Hi ! MY NAME IS LILLIE, In the state of Tex. old bills 4 yrs. or more should be desolved. and a lot of those bills was here when my husband was living. My husband took care of the bills, In 2001 he got colon cancer & he died in 09. how can I get the creditiors to stop calling me. I change my number and that do not help……. I have no money, my husband was my support…WHAT CAN I do . PLEASE HELP ME……

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I Was Widowed a Few Weeks Ago and Left With Debt. – Jerry

Steve Rhode — Fri, 16 Dec 2011 16:17:57 +0000

From How to Get Out of Debt

“Dear Steve,

I was widowed just a few weeks ago and we were living on Social Security with no retirement income. Now I will only have my husband’s Social Security and not mine so will be trying to make it with less income.

I have balances of $5200, $6200, and $7500 on three credit cards and know I will never be able to pay them off on the income I will have beginning in January 2012. I never paid for insurance on any of these accounts, to pay them off in case of either of our deaths, so what alternative do I have to settle this debt? The insurance on my husband paid for his funeral and burial with just under $2000 left but I still have several doctor bills to pay also (mostly the co-pays for doctor and clinic visits prior to his death) but they add up to about $600. I would appreciate any help you could give me.

Jerry”

The Answer:

Dear Jerry,

While you may be what is considered to be “judgment proof”, meaning that if you were sued you may not have any assets for creditors to go after and your income may be exempt from garnishment as benefit income, that’s does not alleviate the stress you may be under.

If these debts were in the name of your spouse alone then the creditors could only look at the estate for repayment. For some reason I suspect these were probably joint debts.

While some may not consider the dollar amounts to be very high, out of reach is out of reach.

If we look at the situation on a more holistic level then we need to factor in your well being and state of mind, now and in the future, over these debts.

I doubt you want to be chased by collectors for years to come. And I highly doubt you want to face the potential of being sued over these debts.

Simply for peace of mind and closing the door on these debts you should consider filing bankruptcy to discharge the debts and close the door on them once and for all. At least that would allow you to move forward without the stress, worry, and strain of these unmanageable debts. It will stop collection captivity and block future issues over these debts.

I would suggest three things.

You can click here to find a local bankruptcy attorney to talk to for free.
You can use the public benefits finder calculator to discover what benefits might be available to help you to help make ends meet.
You can use the Bankruptcy Pro Boni Resource Locator to see if you are eligible for free or reduced cost bankruptcy assistance.

You may also want to read our free publication, “Widow or Widower: How to Handle the Bills After the Death of a Loved One.”

If you have any moral objections to considering bankruptcy you should probably read The Honest and Unvarnished Truth About How to Get Out of Debt.

I’m so sorry for your loss and can’t imagine the stress you are under.

Please post your responses and follow-up messages to me on this in the comments section below.

Big Hug!

@GetOutOfDebtGuy

If you have a credit or debt question you’d like to ask just use the online form. I’m happy to help you totally for free.

My Father Passed Away. My Mother Was Only an Authorized User. – JB

Steve Rhode — Thu, 08 Dec 2011 16:15:52 +0000

From How to Get Out of Debt

“Dear Steve,

Recent widow as authorized user and credit card debt.

My father passed away a couple weeks ago and I have been trying to help my mom with her finances. As I’m sure you know, she lost a SS check so now she is trying to work through her budget. My father and she had two credit cards which she was authorized user but not a joint holder. I understand that because of this, she technically is not liable for the charges on the card. But, she did make a lot of those charges as an authorized user (and the cc company would have a record of that). If she does not pay that debt, is that opening her up to possible negatives on her credit report and/or issues with creditors? I’m just trying to give her the best advice so her credit isn’t negatively impacted. I’m afraid the cc companies will sue her or send the balances to a collection agency and “come after her” for not paying the bills.

What’s also upsetting is the company has been calling her and trying to get her to transfer over the amounts into her name without telling her that she’s legally not liable for the amounts anymore.

Any advice you can provide would be appreciated.

Thanks,
Jennifer

PS She does not live in a community property state.”

The Answer:

Dear Jennifer,

I’m so sorry to hear of the passing of your father.

But I think this can be dealt with. Make sure your mother is no longer using those cards, AT ALL.

Get some additional official copies of the death certificate, not photocopies. Send each creditor a copy of the death certificate and a letter identifying the account number and advise the creditor he has passed.

Send your letter by some traceable means, like FedEx or mail then certified, return receipt requested. Keep the documentation of delivery in a safe place in case you need it later.

The creditors will have to look at his estate for payment and not to your mother directly.

If you follow these instructions that should get the ball rolling.

You may also want to read, Widow or Widower: How to Handle the Bills After the Death of a Loved One. It has some additional tips in it as well.

Please post your responses and follow-up messages to me on this in the comments section below.

Big Hug!

@GetOutOfDebtGuy

If you have a credit or debt question you’d like to ask just use the online form. I’m happy to help you totally for free.

Drive-Thru Funeral Home Offers Convenience But No Beer or Fries With That

Steve Rhode — Tue, 19 Apr 2011 22:08:39 +0000

From How to Get Out of Debt

If you live in Compton, California and you recently lost a loved one, this funeral home offers a unique approach for those that that want to have a viewing, “doesn’t she look good,” and make it very easy for people to attend.

I have to admit, it is an unusual approach but what the heck.

So for the ultimate option of saying goodbye to a recently departed, the drive thru viewing might just be the ticket. Of course maybe we’ll have webcam viewings next. At least they are more ecologically friendly since we don’t need to use expensive gas and more people can attend.

@GetOutOfDebtGuy

Advocates Pushing Back on FTC Proposal Over Debt Collection from Dead People

Steve Rhode — Wed, 24 Nov 2010 23:31:19 +0000

From How to Get Out of Debt

The Wall Street Journal is reporting some consumer advocates are a bit flummoxed over a recent proposal by the FTC regarding diminished legal liability for debt collectors that chase people to pay the debt of dead people.

“The plain language of the Fair Debt Collection Practices Act does not allow collectors to contact friends, neighbors or relatives except to obtain contact information for debtors,” said Robert Hobbs, a lawyer and debt-collection expert for the National Consumer Law Center. “This proposed rule could open the door for collectors to seek money by prodding and misleading grieving relatives and friends into thinking they have obligations that they don’t.”

“The collector first has to identify who that person of responsibility is,” Joel Winston of the FTC said. Many collectors send a letter to the deceased person’s residence and say the person owed this debt and whoever opened the letter has to pay it.

“Under this policy they can’t do that anymore,” he said. “They have to ascertain who the right person is to connect to and only then can they try to collect the debt.

“That should protect people from getting contacted out of the blue through a phone call or letters from some debt collector,” Winston said.

Moreover, the proposal requires the collector to make it clear that the consumer doesn’t have a personal obligation or liability to pay the debt, Winston said.

“If the money is gone, the money is gone,” he said. “Relatives shouldn’t feel bad that something will happen to them if they don’t pay the debt.”

The Federal Trade Commission is seeking public comment on a proposed policy statement clarifying when the FTC will take action under the Fair Debt Collection Practices Act (FDCPA) and the FTC Act against companies trying to collect the debts of deceased consumers.

Post Your Public Comment Here

In collecting these debts, the FDCPA generally allows collectors to contact only the decedent’s spouse, or the executor or administrator of the decedent’s estate. Since the FDCPA was enacted in 1977, state probate laws have expanded the types of persons who are authorized to pay a decedent’s debts from assets in the decedent’s estate, beyond the categories expressly permitted under the FDCPA. In the proposed enforcement policy statement issued today for public comment, the Commission seeks to reconcile the FDCPA’s requirements with state probate law developments.

Under the proposed policy statement, the FTC would not take law enforcement action alleging that a collector violated the FDCPA by communicating about the decedent’s debts with the decedent’s spouse, the executor or administrator of the decedent’s estate, or anyone else who is authorized to pay the debts from assets in the decedent’s estate. The statement also provides guidance about what collectors must do to identify persons with whom they may communicate about paying the decedent’s debt without improperly revealing the debt to others. In addition, the statement emphasizes that, in communicating with someone who is authorized to pay the debts from assets of the decedent’s estate, collectors must avoid creating the misleading impression that the person is personally liable or could be required to pay using his own assets or assets held jointly with the decedent. The proposed statement notes that to avoid this misleading impression collectors may have to disclose that this is not the case.

@GetOutOfDebtGuy

Will I Be Responsible for the Mortgage When My Husband Dies? – Barbara

Steve Rhode — Thu, 18 Nov 2010 14:33:47 +0000

From How to Get Out of Debt

My husband and I are in our late 50s and live in Florida. He gave up his home in a divorce settlement and then bought it back from his x-wife a few years later, before we married in 2009. The home remains in his name only, it is right side up, and he wants the home to revert back to his family members if he should pass. Although I would be allowed to stay in the home until I die, I could not afford the mortgage, taxes, and insurance so it is not an option. (His family members could not afford it either.) His health problems prevent him from qualifying for life insurance so I will get nothing in the event of his death, but I do have my retirement and I would relocate closer to family in Tennessee.

Could I be held accountable for the mortgage if my husband passed away, even though my name is not on the mortgage?

Barbara

Click here to help people to get out of debt.

This reader question was submitted for site members to answer.

This is your chance to be a hero and help out this person by providing your feedback and answer to the question. Post your response in the comments section below.

If you have a credit or debt question you’d like to ask just use the online form.

@GetOutOfDebtGuy

My Father Has End-State Renal Disease. Should He File Bankruptcy? – Nicole

Steve Rhode — Wed, 17 Nov 2010 03:10:27 +0000

From How to Get Out of Debt

“Dear Steve,

My dad has had a great paying job for years but has recently gone through a health situation that has rendered him unable to work at this point. He has end stage renal disease and other problems affecting his heart. He has $61,000 in credit card debt. When he was first hospitalized I called every creditor hoping that they would suspend payments for 2-3 months until we figured out the severity of his situation (my dad has always been very proud of his credit score) and could come up with a repayment plan. Well, of course, no one would help.

My father has a line of credit against his house and he owns a car. The house is worth $80,000 and he owes $62,000. I want to make sure that he will not lose his house. The lawyer I spoke with said he would not because he owes too much on it. All his taxes are paid for 2010 (property and school).

When should I file for him…..at the end of this year or beginning of next and how will this affect his tax return?

Nicole”

The Answer:

Dear Nicole,

I’m so sorry to hear about your father’s illness and his medical situation.

When you say he has “end-statge” renal disease I’m not clear if the prognosis is that he may not live much longer. If the estimate is that he may pass away in the next six months then he may not have to do anything. His debt will end with his estate and if the house is held in joint tenancy the other party will take possession of the property.

However, if you wanted to eliminate the stress from his end days by discharging this debt with bankruptcy then the question is really if he was expecting a big tax refund or not. But that’s kind of immaterial since if his days are limited you’d want to give him the best opportunity to put the debt behind him now and give him the best chance to enjoy what time he has left. In that case he should file bankruptcy tomorrow.

If you want, you can click here to find a local bankruptcy attorney and if you’d like a second opinion, contact Damon Day.

Please update me on your progress by posting updates here in the comments section of your question. I’m very interested in how this works out for you.

Big Hug!

@GetOutOfDebtGuy

If you have a credit or debt question you’d like to ask just use the online form. I’m happy to help you totally for free.

We’ve Lost Three Parents and Had Eight Deaths in Three Years. – B4lee

Steve Rhode — Mon, 04 Oct 2010 22:46:33 +0000

From How to Get Out of Debt

“Dear Steve,

Since 2007, we have had the time of “Job”. From 2007 to Present we have lost, most, just one month apart, 8 deaths, including 3 parents. In the process the stress caused medical and marital consequences to our family. Recession took hold and I became a displaced worker. Miraculously, my spouse, (out of the woods, yet not out of the forest) Workers Investment Act is funding my retraining in the nursing field (LVN).We have two dep. 18 & 20 in school. We use to have an 800 fico, with excellent pmt history. I tried to get on to the Obama Housing Plan, after paying for 4 mos, Underwriting informed me we did not qualify due to insuff income. We have been sent back to Loss Mit for another program, yet thru collections a default was recorded 8/11/10.

I have 2 unsecured personal loans, under my name I took out for medical fees for my mother. They total approx $24k. I tried to settle with the 2 USBank & Citibank $.10 on the dollar, this is all I had, but no avail. I explained to them I have no job and I’m in school etc, etc. My Mortgage Bank has filed 1st default 8/10. Yet the bank states if I get a sale date, to call them for me to notify them so they can post pone it???? No equity, belly up $325K owed, house valued at $175-180K. My husband does not make enough…I do not know what to do…I do not know which BK lawyer to trust, I do not know if we should go to a BK lawyer. I no longer take 800# calls- Stressed with school, and grief! Nursing is a grueling program I hardly sleep.

B4lee”

The Answer:

Dear B4lee,

Yes, it truly sounds like bankruptcy is the route to examine.

The reason bankruptcy sounds so logical is because it seems like with all your loss and travels downwards, now is the time to do what must be done in order to regroup and embark on a path that gives you a real chance at making tomorrow better than yesterday. Bankruptcy can do that.

Bankruptcy will allow you to close the door on the debt you can’t pay and if you are upside down in the house you could even hand the house back to the bank and be able to move on without the worry the bank will go after you for the balance due on the mortgage.

While the thought of going bankrupt may feel extra stressful at the moment, I’m confident that once you examine what it would mean for you and the protections it will offer you, it could be a true blessing at creating a safer financial future. And no worries on the credit score impact. You can easily rebuild your credit score again.

You can click here to find a local bankruptcy attorney and if you’d like a second opinion about your situation or a personal consultation by another debt coach, please feel free to contact Damon Day.

Please update me on your progress by posting updates here in the comments section of your question. I’m very interested in how this works out for you.

Big Hug!

@GetOutOfDebtGuy

If you have a credit or debt question you’d like to ask just use the online form. I’m happy to help you totally for free.

Will My Family Have to Pay My Debts From My Life Insurance After My Death? – John

Steve Rhode — Mon, 19 Apr 2010 12:13:04 +0000

From How to Get Out of Debt

“Dear Steve,

I have $152,000 in student loan principal, down from $163,000 after 6 years of payment. $77,000 are at a fixed rate of 2.625%. $6000 are at 5% fixed, and $69,000 are at a variable rate, which currently averages 2.5%.

I also have $22,000 in credit card debt, which is at fixed rates of 4.99%, 3.99%, and 2.99%. The average rate on the 3 cards is around 3.75%.

My monthly payments are interest only on the student loans at $410 per month and my credit card issuers want me to pay 2% of balance plus interest, so the payments are about $470 per month.

I rent for $600 per month.

My car is 22 years old.

My income is $44,000 per year, working one FT and one PT job.

Will my family have to pay any of my debt from the proceeds of my life insurance after my death?

John”

The Answer:

Dear John,

Upon your demise creditors can only look to your estate, your part of assets for repayment of debt. The life insurance proceeds are a benefit to the beneficiary, just like a 401(k) is, so it is not part of your estate.

It also depends if the debt is a joint obligation with a surviving family member or spouse. That agreement lives past your death.

In the community property states of Alaska, Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington, and Wisconsin, the liability of debt after death is more complicated. These are community property states. If you live in one of these states you should speak to a lawyer licensed in your state for specific advice.

Big Hug!

@GetOutOfDebtGuy

I’m Buried in Grief and Trying to Deal With My Debt. – Rebecca

Steve Rhode — Fri, 26 Feb 2010 17:59:58 +0000

From How to Get Out of Debt

“Dear Steve,

At the moment, I’m overwhelmed to the point where I’m not sure what to do. Last year my [redacted]. I find myself in over my head with credit card debt. In the middle of such grief, you’d think debt would be the last thing on my mind, but it is only adding to the stress, plus I can’t seem to think clearly. I can find no way out except bankruptcy.

I contacted a debt consolidation company who informed me that I don’t make enough money for consolidation. I’m saving up to hire an attorney, but won’t be able to afford it for a few months. In the meantime, visions of angry mobs of credit card companies camping out on my lawn, lawsuits, and not the least, my own guilt for not being able to pay debts that I do owe, is causing me much pain. I’m scared, really. What happens to people like me who just can’t pay their creditors, and who can’t get an attorney to protect them until months after they’ve already stopped paying the credit card companies? I’m nearly $16,000 in debt to several different credit card companies. I don’t even know how I ended up owing such a huge sum.

I do own a home, but I’ve only been in it for nearly three years, and do not have very much equity built up. I live in Ohio. I’m afraid I’ll lose my house to the credit card banks. I’m not behind in my mortgage payments and don’t plan on being; I just can’t continue to pay the credit cards. My mortgage I can pay.

I don’t own a car or have any money in the bank, so I really have nothing for the cc companies to take, except for the house. And maybe my sanity, but I understand that’s my own fault.

If you wouldn’t mind, I would appreciate it if you wouldn’t publicly post [redacted above].

I guess my main questions are: I don’t have a bankruptcy attorney yet, as I can’t afford to hire one. It will be several months before I have the fee. In those months not paying my credit cards, what can and will the credit card companies do? Will I be safe in those three or four months it will take me to get money for an attorney? And should I avoid the Banks calls until I get a lawyer, or answer and explain to them that I’m going to file?

Thank you so much for your help,

Rebecca”

The Answer:

Dear Rebecca,

First let me say how very sorry life has served up such much loss and grief for you in the past year. I respected your request with the question you submitted to not disclose what that loss was, but anyone that knows your situation knows what a tremendous burden you are suffering under.

The credit counseling group you contacted did you a favor by not letting you in to their debt management plan when there was no reasonable expectation you could afford it.

Here is the game plan I think you should follow.

Click here to find a local bankruptcy attorney. Go talk to them and make plans to file bankruptcy.
Stop paying all the credit card companies and save that money to pay for your bankruptcy.
Just let the collectors call. As long as you flow through the normal collection process it buys you some time to save for the bankruptcy. When the collectors call just tell them you can’t afford to pay right now and don’t make any promises to pay that you don’t intend on keeping. There is no need to tell them you are going to file bankruptcy if you don’t want to, they’ll find out when they get the bankruptcy papers.
Rest assured nobody is going to come to your door or camp on your lawn and nobody wants your old stuff back.
If you are feeling depressed, please go talk to your medical doctor about how you are feeling. There are treatments that can help you with the depression and that will help make it possible to face the day.
Above everything, make sure if you want to stay in the house that you continue to pay your mortgage payment on time and in full.

With everything you’ve been through your emotional defenses are down right now and everything is feeling raw and immediate. But your creditors are not judging you over this situation. You are just a number on a page to them. The best thing you can do now is to go meet with the bankruptcy attorney ASAP and get the solution moving ahead.

You need to remember, you are no more a loser in this than the tree that falls during an intense storm. If the tree could feel guilt would it feel it failed? You need to forgive yourself here and realize that at this point in your life, it just is what it is. Realize the only person that can judge you is you so stop it, please.

Big Hug!

@GetOutOfDebtGuy

If you have a credit or debt question you’d like to ask just use the online form. I’m happy to help you totally for free.

Did My Dad’s Debt Die With Him? – Graeme

Steve Rhode — Tue, 16 Feb 2010 21:46:24 +0000

From How to Get Out of Debt

“Dear Steve,

My father died but has outstanding credit card debt to the value of $33,000 in his sole name. He had some land but upon his death it was tranfered soley to my step mothers name. She doesn’t have any money to pay the credit card debts.

Can the banks make my step mother sell the land to pay the debt ot did the debt die with my dad?

Graeme”

The Answer:

Dear Graeme,

Ultimately this is a question for a probate attorney. I’ll give you my impression of the situation but you need to talk to a lawyer licensed in your state for a legal opinion.

I suppose that the issue about the land is if the land was held jointly by your stepmother and your father. In that case the land could not be sold to pay his debt. It would have simply just passed to the other joint owner.

But if your father left the land to your stepmother and the land was then transferred from him to her then, in my humble opinion, the land would have been a valuable asset of your father’s and as part of his estate could have been used to repay the debts from his estate.

Please talk to a lawyer in your state.

Please update me on your progress by posting updates here in the comments section of your question. I’m very interested in how this works out for you.

Big Hug!

@GetOutOfDebtGuy

P.S. Be sure to read ‘The Secret of Surviving Through Difficult Economic Times. What I Learned On My Journey‘.

If you have a credit or debt question you’d like to ask just use the online form. I’m happy to help you totally for free.

My Husband Has Aggressive Advanced Cancer and Our Debt is Killing Us. – Gina

Steve Rhode — Thu, 11 Feb 2010 15:57:36 +0000

From How to Get Out of Debt

Gina

“Dear Steve,

We have a lot of debt and serious medical issues that are generating medical bills we won’t be able to pay.

We bought a new house 2 years ago and haven’t been able to sell the old house. It is rented for just enough to cover the first mortgage payment. We have a maxed out equity line on that house as well.

The new house is in a neighborhood in which the values have fallen some and there are many houses on the market that aren’t moving (NC).

We have $25,000 in student loans, $15,100 car loan, $58,000 in unsecured debt and a loan on the 401k of $7700.

We are paying everything on time but have no savings. My husband has very recently been diagnosed with an aggressive, advanced cancer and has just begun treatments.

We have health insurance but it is a high deductible plan with an HSA that we just started about a year ago so this first round of bills will wipe it out. The hospital that is doing the treatment is out of network so we will have to pay 50% after we meet the annual $12000 out of pocket maximum.

We have considered walking away from the mortgage and keeping other things current or just filing bankruptcy and trying to start over. Right now we make about $98000 annually but the loan on the 401k eats up $600 per month and we can not get them to let us discontinue the payroll deduction as some of the money is company contribution and they tell us that we can’t have access to that prior to age 55 except through the loan. We really don’t know what to do and the stress is awful.

Especially in light of dealing with my husband’s serious diagnosis.

Given our situation, what is our best course of action. Is there any legal way we can stop the payroll deductions so that we don’t have to file bankruptcy or lose the house?

Gina”

The Answer:

Dear Gina,

First off, my prayers and hopes go out to you and your husband to beat his cancer.

I am so sorry that you have to deal with the financial pain at a time of emotional and physical pain. Unfortunately, it is a situation faced by many.

Now my suggested course of action is from a holistic point of view and individually the parts might not seem sensical but as a whole I think they make sense.

You’ve said that your husband has advanced and aggressive cancer. Not that I know anything more about his medical condition, but for the sake of this discussion, while I hope that he has a full recovery, sadly I’m going to assume the worst.

If your husband were to pass away his payroll deduction for the loan would cease and the plan would be paid out.

Additionally, if he were to pass away, I suspect that you will have some amount of life insurance coming to you, either from an individual policy you may have or an employer sponsored group insurance policy.

Probably one of the most important areas to keep stable at this time, is the house in which you both currently live. I would image that not having to deal with moving right now, would be a blessing for the both of you.

My primary goal at this point is to set you up with a plan that will minimize the stress to help you to deal with the cancer, and to prepare you in the event that he were to pass away.

I think the most logical approach in that case is for you to seek legal protection under chapter 13 bankruptcy. Why a chapter 13? This should allow you to regroup your finances to what you can afford in the situation. It will also protect you from any collection activity at a time when you least need that stress.

But I think it is imperative that you immediately find a local bankruptcy attorney and discuss this situation openly and honestly from the point of view of the life you need to live under the circumstances you have. The attorney will see that with the massive out of network bills still coming that more debts will be piling up from that so a chapter 7 bankruptcy probably does not make sense right now. A good plan of action and coordination with your bankruptcy attorney is going to be just as important as good medical right now.

Using this approach you will also be able to stay in your house and keep your car so you can get back and forth for medical treatments.

You may want to think about handing the rental house back to the bank and including any debt from that in your bankruptcy.

His student loans will not extend past his death if they are government backed loans. In the meantime if he is totally or partially disabled you could apply for a discharge under that program. Here is the form.

In bankruptcy, any life insurance proceeds should not be attached by your creditors. If it does appear that your husband will regrettably pass away, then talk to the bankruptcy attorney about converting your chapter 13 bankruptcy to a chapter 7 bankruptcy at that time and include the remaining medical bills that can’t be paid.

I can only steer you based on what you’ve shared with me. I strongly suggest that you print out this question and answer, contact a local bankruptcy attorney, schedule a free appointment to go in and talk, and discuss this approach and your situation with the attorney.

I just want for you to understand, that bankruptcy in this situation is not a failure route. It is a route that will allow you to minimize your stress, get the most consumer protection, allow you to make your time left with your husband the best it can be emotionally and without the stress of this financial situation, and prepare you for debts to come.

Big Hug!

@GetOutOfDebtGuy

My Sister and Mother Died and Now I Am Raising Additional Children. – Erika

Steve Rhode — Fri, 22 Jan 2010 22:39:42 +0000

From How to Get Out of Debt

Erika

“Dear Steve,

I did debt relief before when I got divorced and my husband left me with all the bills and disappeared for 4 years.

Now my situation is my Sister passed away and my Mom in the same year and out of 10 of us in the family, me being the youngest with one child, no one wanted to take the 2 children. One was a senior in high school (girl) and the boy was a sixth grader, so I took them in and am raising them now.

The girl is in college now and the boy is a junior in high school. Financially I have had it hard from day one, I am deeply in debt from getting big loans and credit cards just to buy them clothes, get her into college and just living day to day, and raising my daughter as well. I got help from no one in the family at all and I am seriously in debt. I was keeping my head above water, but now I feel like I’m drowning. I need help.

Can I get debt counseling again even if I have done it before?? Also I got a big loan from Beneficial $20,000 and can this be included in the debt consolidation???

Erika”

The Answer:

Dear Erika,

You have certainly been admirably responsible for your niece and nephew. It is certainly unfortunate that others in the family are not willing to lend a hand to help you but I guess it is what it is.

Even if you were in some sort of debt management plan in the past, you can certainly try to get back in. Times have changed and a second chance is possible.

But I think the bigger issue is if a debt management plan is the right approach for you to take if you are having to borrow to just keep your head above water.

The best course of action here would be for you to investigate both bankruptcy and credit counseling and then armed with the facts you can make a choice about which approach would help you to resolve the current financial problems.

You can click here for more information on debt management and click here to schedule a free bankruptcy consultation with a local bankruptcy attorney.

Once you have done both of those things, come back and leave a comment to this post at My Sister and Mother Died and Now I Am Raising Additional Children. – Erika, about what you learned from both of those meetings and I’ll help you find the right path to follow.

Big Hug!

@GetOutOfDebtGuy

Am I Responsible to Pay for My Dead Husband’s Debts? – Linda

Steve Rhode — Fri, 22 Jan 2010 21:08:10 +0000

From How to Get Out of Debt

Linda

“Dear Steve,

My husband passed away and now Bank of America wants to know when I’m going to pay off his credit card.

Am I responsible to pay off my husbands credit cards ? If so is it possible to have the payoff amount lowered ?

Linda”

The Answer:

Dear Linda,

Bank of America might want you to pay off your husbands debts, but they can’t. Any debt in your husbands name alone is not your responsibility unless it was a joint debt.

Another rarer exception is if you were an authorized user that continues to use the account long after the debt of the primary account holder.

If the debt was only in the name of your husband than Bank of America can only look to the estate of your husband for payment.

I would suggest that you go and see a local attorney to assist you with this so you can chop Bank of America off at the knees here. The pursuit of relatives is picking up steam. Collectors will try anything to get payment, legal or not.

If you want to see what debts you might have been a joint account holder of I would urge you to get a copy of your consolidated credit report. You will need a consolidated credit report to show you what is said by all three credit bureaus. Take this consolidated credit report with you to the lawyers office. If the credit report shows that you were not a “J”, joint account holder, a letter from the lawyer should end this and by this time next week you’ll be done with it.

Big Hug!

@GetOutOfDebtGuy

My Father Passed Away. Is My Mother Responsible For His Credit Card Debt? – Richard

Steve Rhode — Thu, 05 Nov 2009 13:02:19 +0000

From How to Get Out of Debt

“Dear Steve,

My father passed away with credit card debt. In the state of Texas is my mom responsible for the creit card debt. She ws not a co applicant on the card. She was only a autorized user.It is going to be hard for her to make since she was a stay at home wife.All she has is a little life ins policy and apaid off house thanks for your help

Richard”

The Answer:

Dear Richard,

What you should do is obtain some additional original certified death certificates. Once you get those you should write a letter to each credit card company your father owe and explain that he has passed away and include a copy of the death certificate. That should end the issue as long as your mother has not continued to use the card after his death. Make sure she does not use any of those cards she was only an authorized user of.

Please update me on your progress by posting updates here in the comments section of your question. I’m very interested in how this works out for you.

Big Hug!

@GetOutOfDebtGuy

P.S. Be sure to read ‘The Secret of Surviving Through Difficult Economic Times. What I Learned On My Journey‘.

If you have a credit or debt question you’d like to ask just use the online form. I’m happy to help you totally for free.

My Father-In-Law Died and Left My Mother-In-Law Deep in Debt. – Sherry

Steve Rhode — Fri, 09 Oct 2009 17:41:17 +0000

From How to Get Out of Debt

“Dear Steve,

My father in law passed away and my mother in law has been left with an enormous debt. we did not realize they were this much in debt and are trying to figure out the best option for her.she is 73 yrs old. just to make her payments each month she is 500.00 short. she has a mortgage payment 950.00, home equity payment 150.00, about 6-7 credit cards estimated 15,000.00 total balance. plus all utilities and insurances.

Would like to know at her age and the amount of debt she has what her best option would be; debt settlement company, bankruptcy or some other option.

thanks

Sherry”

The Answer:

Dear Sherry,

I had the following questions that I’d like for you to answer before I can answer your question. Please post your answers in the comments section of your question. I’m looking forward to helping you for free.

Is this residual debt, joint debt in both of their names or was it in his name alone?
What kind of debt and how much are we talking about is the problem debt?

As soon as you can post the answers to my questions above I’ll be able to help.

If any reader wants to offer advice in the comments section please feel free to participate.

Big Hug!

@GetOutOfDebtGuy

If you have a credit or debt question you’d like to ask just use the online form. I’m happy to help you totally for free.

My Husband Died and I Was Laid Off. – Linda

Steve Rhode — Fri, 27 Feb 2009 15:27:30 +0000

From How to Get Out of Debt

Linda

“Dear Steve,

I am 51 years old. My husband died 3 years ago. I was layed off from my job in Oct. 2008. I have over 40,000.00 in credit card debt and 50,000.00 on a home equity loan. The interest rates are killing me. I may have to file bancruptcy.

How can I lower my interest rates so I can avoid bancruptcy and continue paying off my debts?

Linda”

The Answer:

Dear Linda,

The best chance of getting the interest rates reduced would be to enroll in a debt management program, but only if you can afford the amount of your monthly payment.

I’m worried that if you are still unemployed that enrolling in any repayment option may be draining you of money you can’t replace. In that case bankruptcy might be a much better option for you. I would suggest that you go an meet with a local bankruptcy attorney and have a free bankruptcy consultation to discuss if bankruptcy is right for you, before you consider a debt management program or credit counseling solution.

Big Hug!

@GetOutOfDebtGuy

My Husband Passed Away And Now the Credit Card Company Wants the Full Amount. – Merle

Steve Rhode — Thu, 26 Feb 2009 16:01:22 +0000

From How to Get Out of Debt

Merle

“Dear Steve,

I have a credit card that I’ve had for over 10 years. It was in mine and my husbands name. I have been paying by check signing my name all this time. My husband passed away almost 2 years ago. They found out and are now calling for the full amount of $6,000. I haven’t been late on payments, what are my options.

Merle”

The Answer:

Dear Merle,

What I find interesting is that you are not behind and the credit card company is demanding full payment. I wonder if this card was in your husbands name and you were just an authorized user on it?

I think what you should do is to follow this link and get a copy of your consolidated credit report and see how the account is reported. If it is listed as a J account, it is joint. But if it is listed on your credit report as an A account, you are just an authorized user.

If you are only an authorized user the credit card company would have to look at your husbands estate for payment.

If you were only an authorized user and continued to use the card after his death and you are just an authorized user, then I have seen the credit card companies go after the authorized user.

Before we rush to any sort of conclusion I need some more information. Get the consolidated credit report and let me know how that account is reported. And while you have the consolidated credit report in your hands, look for any other accounts that remain open that you might not know about, following the unfortunate death of your husband.

Big Hug!

@GetOutOfDebtGuy

We Are Sinking Fast And Using Credit Cards For Daily Purchases. – Valerie

Steve Rhode — Sun, 01 Feb 2009 21:20:27 +0000

From How to Get Out of Debt

URGENT QUESTION!

Valerie

“Dear Steve,

I cried all through writing the question. Situation is that we’ve always paid our credit card bills and always been on time and lately our credit score keeps getting worse and worse. Our mortgage/taxes/insurance costs $3000.00 per month so I don’t want to default on that. Yes, we have remortgaged too many times. Presently, I’m making more-than-minimum payments on all (maybe 20?? credit cards) We only buy groceries, gas and Christmas on our cards now. We are both working 40+ hour weeks and are 54 and 55.

We are getting tired and old and feel, like we’re not running as fast as the treadmill is rolling. We would gladly sign up to pay off all of our cards and NEVER use them again, but right now, we need them just to buy our normal daily supplies so that we can pay our bills with our paychecks.

We feel like we are fighting a losing battle. If we stop swimming for one second, we will drown. Is there any credit card consolidating things that are legitimate.? None of them ever wanted to help my daughters until they were already several months overdue.

I don’t want to make things any worse. Electric bills and oil bills are the only things that are getting paid out of pocket and oh yes, doctor office co-pays. I could go on for days. I just need some relief and don’t know where to turn. Also, we have life insurance payments that are falling behing which means that those will close soon and then we will not be able to leave anything to each other, which will mean that the house will go; as it won’t be paid off till we are 80 something! HELP! Any good ideas?

We’ve really lived a good life and now I feel like some kind of bum!

Valerie”

The Answer:

Dear Valerie,

As an outsider I probably have a different point of view since I’m not right in the middle of what feels like a crumbling life. So let me offer some observations and suggestions.

All debt problems can be resolved in one way or another. Now that might not mean that you can wave a wand and get everything you want, but we can put a plan in place to allow you to move past the fear and pain you are experiencing now.

What I ‘hear’ when I read your question is someone who is slowly drowning under growing debt. Unless you’ve had a reduction in income, I would bet that your debt has been growing, slowly, over time. You debt has finally reached that level where you are forced to deal with it. Imagine it like this, it is a lot like a room that is filling slowly with water. You don’t begin to really panic until your head is bumping against the ceiling and the air pocket is getting smaller and smaller. That is when you freak out because you are convinced you are going to drown.

The best way to attack this situation is to prioritize your obligations first, so let’s see what we can get to fit within your family income. Whatever does not fit, will have to be dealt with.

So let’s first pay housing, utilities, food, life insurance, medical insurance, transportation expenses, etc. and factor in $100 a month to put into a boring old savings account for emergencies. And when I say to save the money each month, I mean it. Save! You’ve got to put your safety and security first. Nobody else will and if you just let your creditors continue to take from you, you will be homeless and older, with less chance to save.

Now, once you prioritize your expenses I bet you will find that you don’t have enough leftover to make minimum payments on your credit cards. How can I be so sure about this? Well the clue was when you said you had been using the credit cards to pay for “normal daily supplies” and that your credit score had been getting worse and worse. Your credit score is sinking because you are becoming a higher and higher credit risk with escalating debt and maybe a missed payment here or there.

And while you had the best of intention in paying a bit extra each month, it might have helped emotionally but it really only sinks you more. You send $20 to the card but have to charge $20 to get by. I’m not blaming you, just pointing it out. There is no reason to waste a perfectly good mistake if we can learn from it.

Is credit counseling or debt management legitimate you asked. Well, it is legal but it is not the best approach is you are slipping under the strong riptide of overwhelming debt. It is better to turn to credit counseling if you are behind now due to some event that just put you behind and now you need to get caught up. That’s not your situation. Yours was not a one time event. It is a recurring monthly event.

Sadly I think we need a more formal intervention here and you need to seriously consider bankruptcy. There is a way that you can go bankrupt, in a Chapter 13 bankruptcy, where you can keep your house, so don’t worry about that.

Just about now your heart is beating fast and those old feeling of being a bum or a failure are racing through your mind. Those feeling are not reality. They are emotional thoughts in response to a difficult situation and those feelings are normal, just not logical.

We have all been conditioned over all our lives to repay our debts, honor our promises, and make at least the minimum payments. If we don’t then we are supposed to fear what will happen to our credit report and credit score. We are supposed to feel like a loser for being in collections and we don’t want the debt collector calling us and judging us.

So to avoid all those feelings and emotions we keep doing what we think is expected of us. We make the minimum payments by any means possible and we hope that things will get better tomorrow. But that does not mean that is the right thing to do.

Valerie, if you stay on your current path you will increase you stress and your chances of being ill or dying from this debt stress. You’ll die without life insurance that you dropped to make the credit card payments and the remaining spouse will not be able to afford the house and they will lose it. And guess what, the credit cards are not going to get paid anyway.

Let me ask you this. Do you have a greater responsibility to yourself to fix the past or fix the future so it is safer? The right answer is, the future. We can regret choices and decisions we’ve made in the past but that does not change where we are going to rest our head tomorrow, how we can going to stay warm or cool, and what we are going to eat.

So Valerie, if you are not prepared to honestly face a bankruptcy attorney and consider bankruptcy, then click here for debt management information. You can go on a debt management plan if you like, try it for a few months and see if you are able to afford it and get ahead. Then, if you discover that you are still sinking, you can go see the bankruptcy attorney for a free bankruptcy consultation and hold your head high knowing that you tried everything before filing bankruptcy. Some would criticize me for saying that. They would feel that I was encouraging you to throw good money after bad in a credit counseling program but I don’t look at it like that. If you go into a credit counseling program and fail, then you’ve simply made an investment in knowing that it’s not going to work for you. You won’t be able to look back with regret and knowing that has some value to everybody.

If you decide to try the debt management route I would still urge you to click here to get a free bankruptcy consultation so you can be more informed about what bankruptcy really means for you without assumptions and emotional fear. Only once you have fully explored both options will you be able to make a good informed decision that is right for you.

Valerie, don’t cry. There is not one logical reason for you to live in fear of your debt from this point forward. Now is the time to take action, implement it and make every day from this point forward, safer.

I’m sending you an extra big hug.

Steve

Janet Is In Trouble. She Says “I’ll Be Out Of Money Soon. What Should I Do?”

Steve Rhode — Wed, 01 Oct 2008 03:25:09 +0000

From How to Get Out of Debt

“Dear Steve,

I bought my first home, moving from Pennsylvania to Florida, the only place I knew all my life, following the death of my beloved mother.

I was able to put a down payment on a house in a beautiful community in Florida, & live rather cheaply as compared to Pennsylvania. Unfortunately, the job market has not been kind to me and I have been unemployed for 5 months. I have borrowed from every resource possible and have been through a line of credit of 31,000 over the past 1.5 years.

The pay scale here is ridiculous…something I was not aware of and only wish I had done my homework on that front. I am now trying to start my own home based business, but in the meantime I have all these bills that are going to go unpaid after this month, including my mortgage.

I fear going into foreclosure or losing my home. I am determine that I will not become another statistic.

What do you suggest I do to get by for a few more months. I know I will do well with this business and or find a job…it is not paying my bills that concerns me. I had a great credit score, but I believe it went from 730 to 680 now, since I missed paying a bill or two by a few days. I do not know what else to do. I would appreciate your input. I have approximately $170,000 debt which includes my two mortgages and credit cards, and need about $2000 per month to pay all my bills.

Help!

Janet”

The Answer:

Dear Janet,

I had so much to say that I launched a new podcast show and your question and answer became the focus of the very first show.

You can listen to the show using the player or link below.

Big Hug!

@GetOutOfDebtGuy

Give Me Credit Podcast

Listen to my answer using the audio player below or the link below.

Give Me Credit – Show 1 – Janet

How to Get Out of Debt With the Get Out of Debt Guy » death

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