My Mother who is 68 yrs. old was recently widowed. Her and my step-Father were already on a limited income. She gets s/s beniftits of approx $800.00 per mth. Along with a small Retiremet check of $110.00 per mth. She will now loose the $900.00 of my Step-Fathers S/S income. Basically Half of her Montly income wiped out.
The Death benifits fom his life insurance was enough to pay for the funeral and leave my mother with a small cash pay-out. Somewhere in the range of $1500.00 to $2000.00. Together they have approx. 13,000.00 in Credit card debt. Her minimum montly payments are about $275.00 per mth. Can you help me with your knowledge? So I may attempt to dig her out of this whole? I am willing to help her. However, I need some advise on the best way to cut the debt? Lower the High Intrest on the cards And Lower the payment so We can set her up an budget.
Her home is paid for. She has 2 used Vehicles both pad for. However, Neither Vehicle holds enough value to secure the debt balance. And in my oppinion a Personal Loan secured by Autos, The intrest rate would still blow her out of the water.
Even though The Intrest Rate would dropped dramatically , We Really Prefer not to mortgage the home or take out an equity line of Credit to Pay-off the cards thus turning un-secured Debt into Secured Debt. I would like to add that she presently has A-1 Cerdit and is Current on all her household bills including the Credit Cards. We are simply attempting to head this off at the pass so to speak? In order to avoid late fees, and higher intrest rates in the coming months.
I guess my question to you is this. Are there any Government plans in the Bail-out projects, that would provide some relief for Eldery widowed individuals. Perhaps something in place that we could negotiate the principal down and cut or eliminte the Intrest?
There are no government backed plans to reduce what she owes or eliminate the interest except bankruptcy. Bankruptcy is a legally sanctioned solution.
A debt management program or credit counseling program may be able to reduce her interest rates but the payments will stay about the same as they are now. I don’t know how much of a help that is either.
Are you willing to help her make some of the payments on this debt? But with her limited income I’m wondering how much, if any, she can really afford to pay each month? I’m concerned that any solution that will require her to make a monthly payment to dig herself out of this hole will simply be too much for her.
Was this debt joint with her husband or only in his name?
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.
P.S. Be sure to read ‘The Secret of Surviving Through Difficult Economic Times. What I Learned On My Journey‘.