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Retired Couple Takes Out Loans With Payments Twice Their Income

Written by Steve Rhode

“Dear Steve,

My wife and I are retired with a fixed income of just under $3000 a month. Over the last few months, we’ve had to take out loans at several, high interest businesses.

Now, our payments are twice our income. We have a small place, (mobile home and storage bldgs.) valued at about $20,000, which is free and clear.

My credit score is only 616, but I’d Like to find somebody that would give me a note for the appraised value so we can get back to being able to pay our bills, again.

We are ‘floating’ checks now to try to keep afloat. Our credit card debt isn’t all that much, maybe a total of $7000. Our other place has a mortgage of about $37,000 and is valued slightly higher, but the bank (JP Morgan Chase) won’t refinance because of the low credit rating and not enough equity.

Is there investors out there who would be willing to do a debt consolidation loan, with a note on our nice little place?


Dear Doc,

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Modern business conceptIt sounds like you’ve been taking out payday loans or storefront installment loans. These lenders engage in high risk loans and just because they will approve you for a loan does not mean you can afford it.

The most likely legitimate source for a loan secured with property as you describe is going to be a local credit union. But keep in mind the quality of the collateral is important. If it’s not something the lender is will to take back, they won’t be interested in making the loan.

The reality is your situation started previously by some event which led you to have to take the first loan out. Hopefully you were not draining retirement funds or savings to get by.

Based on what you shared, I seriously doubt you are going to find a lender who will either accept the collateral or make a low interest rate loan. You may have to seek other options like bankruptcy.

You can click here to find a local bankruptcy attorney and talk to them for free about your specific situation. Get the facts and then you can make an informed and educated decision if bankruptcy is right for you.

It would be hard to even forecast you’d be able to budget your way out of this situation since your loan payments are twice your monthly income. Logically what we are going to need is some quick way to intervene in the debt, discharge it, and get you back to living within your income.

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About the author

Steve Rhode

Steve Rhode is the Get Out of Debt Guy and has been helping good people with bad debt problems since 1994. You can learn more about Steve, here.

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