Bankruptcy the right choice?

[bbhill]

Okay, so my mother is in a tight spot, and I'm not exactly in the position to help her a whole lot right now (I'm trying to pay for college right now). Here's the deal, my mom isn't real good with finances and the last few years I was in high school, she racked up about $12,000 in credit card debt trying to pay bills and living expenses. (about 2 years ago)

About a year ago she got a full time job paying about $12 an hour to support herself while I went off to college. During this period of about a year she kind of tried to ignore the debts which I persuaded her not to, but in her financial situation there was really no way for her to pay or negotiate with the creditors. Now one of the creditors is about to go ahead and get a judgement and start wage garnishment for 25% of wages. (negotiation with them is already out of the question--they already have a full judgement payout in their eyes) Now this will be putting her income near minimum wage. This scares me considering her age and detoriating health in addition to the fact that she has no savings whatsoever to pay for medical bills.

Currently my mother has no valuable possessions, just an old car and some furniture. (rents an apartment). She's aging (nearing 60), so credit score isn't an issue since she's staying far away from credit cards now and has no plans to buy a house or car. Getting a second job is also pretty much out of the question since she is always extremely exhausted after working her first job. Basically I see no way for her to get out of this mess unless a) she pays the money and court costs from a 25% garnishment for or b) she files for bankruptcy.

Does anyone know any good and inexpensive bankruptcy attorneys that would be willing to give a consultation on the chances of a successful chapter 7 bankruptcy? I figure the costs of going through a chapter 7 bankruptcy would pale in comparison to the costs of a judgement. Ive found out that it has become considerably harder to file chapter 7 bankruptcy since the reform laws a few years ago, but I would think her relatively low income to debt ratio would be somewhat beneficial to her case right?

My mother is under a considerable amount of stress and has occasionally talks about suicide, so I'm really trying to give as much emotional and financial support as I can. I don't need any moral lessons or lectures here, so if you are just going to say that she needs to be responsible and pay up, that won't help. Everyone makes mistakes and has reasons for doing the things they do and I hope that you would respect that. I would just like some advice on the situation if possible.

Thanks a lot!

[PennyQuilts]

A women in her fifties who has that much credit card debt and just ignored it, is making 12 bucks an hour, with few possessions and has a judgment against her isn't someone who made a mistake." Perhaps the only thing she has going for her is that she raised a good son who wants to make a better life for himself and that is something to be very proud of. That appears to be the reality of the situation.

However, nearing 60 is NOT aging. You sound like you are taking on some responsibility for her decisions (she racked up the bills while you were in highschool). She has clearly made decisions and life choices that have left her in a bad spot, financially. That is probably not going to change, my friend. Short of you paying her bills and being prepared to pay her bills from here on out, you can expect this pattern to continue if her decisionmaking doesn't change. For a young man your age to be the one who is counseling on financial decisions says a lot. Kudos to her for now staying away from the credit cards.

At the same time, you said she has talked about suicide. Is she bi-polar? Is she under the care of a physician? Reading between the lines - which is dangerous and probably foolish - is that she has probably suffered from depression over the years and it has impacted her decision making to the point where it has swarmed on her. Alternatively, she is one of those people with the type of personality who plays the victim and expects others to rescue her. But that is a stretch from what you are saying.

They can't get blood from a turnip. Her bigger problem, I'm betting, is her mental health issues. She needs to get to the doctor or, if she is on medication, she needs to get a med eval and get that depression under control. The avoidance and poor decision making are classic symptoms of depression and it is treatable. After she gets out from under the fog, she can probably make better decisions for herself.

Good luck.

[bbhill]

I believe you hit many points on the head.

First, she did try to raise me pretty well through high school, so I feel a sort of attachment to her financial situation, although I know technically I'm not responsible for it, but I would hate to turn a blind eye to her situation.

As for changing her financial ways, I would say she has done pretty well this last year. She's been living within her means and has done so with me only picking up some slack on bills every so often. Although she's still not totally responsible, I believe she's taking steps in the right direction to become financially independent.

Secondly, she has always been somewhat depressed throughout her life, which I agree definitely led to what happened. After my father's suicide several years back, she had basically been living off of social security death benefits which I think she kind of hoped would last forever. I think she somewhat also hoped to have the debt to just disappear as well. I've been trying to get her to see a psychologist of some sort, but she's somewhat stubborn about that. And I do agree that a lot if not all of this is fueled by a considerable amount of ongoing depression. Thats something that I should probably give more attention to.

Thanks for your input

[PennyQuilts]

Well, I hope she goes - if she can get that under control (assuming that is the problem) she really will be happier. That is a hard road.

I'm sorry about your dad. Good for you that you've picked up the pieces and are working to get a good foundation for your life.

[Easy180]

She should definitely consult a bankruptcy atty...they can probably tell her within 15 minutes if a Chapter 7 would fly...Would take a lot of stress from her life once it's discharged

[SMKrausnick]

Buy her a book. "The Total Money Makeover" by Dave Ramsey. It has a lot of advise on how to deal a situation like hers. She may not be as close to being sued as you think. It will take her a few days to read the book and it should help her out immensely.