Almost everyone thinks about death at one time or another, especially after the passing of a loved one or good friend. One of my close friends passed away recently, and it made me think about the interrelationship between what I do, working with people to solve debt problems, and what we can do to solve these problems. I realized that this happens much more often than I had previously thought.
This week, a couple came to my office to talk about the wife's mom. Her husband had passed away about two years ago, leaving his wife with almost nothing. There was money to pay for the funeral, but no life insurance or pension plan or any other money.
The Mounting Debt
The mother lives in a modest house, worth maybe $90,000, with a mortgage of about $800, and there is approximately $20,000 in credit card debt with monthly payments of about $500. The deceased husband had Social Security income of $1,700 and she another $750 in Social Security. But upon his death the wife's income was reduced to what her husband was receiving, which was $1,700.00.
With a mortgage payment of $800, utilities of about $400 per month, food at $300, gasoline and car insurance of $200, they were able to make the credit card payments. Things were different now with $750 less income per month, and the widow found herself charging groceries and gasoline, or using one credit card to pay another. The credit card bills started mounting.
The daughter had come over the house to check up on her mom and discovered that her mother was being sued over delinquent payments on a credit card. Her mom broke down and cried and told her how she couldn’t make the payments.
Considering Your Options
The daughter called Steidl & Steinberg and we met with her mom to discuss the options. We decided that a Chapter 13 bankruptcy would be appropriate to get rid of the credit cards. Mom kept the house and continued to make the mortgage payments, and kept her car and everything else she owned.
At the meeting of creditors where I represented the mother, she hugged me when it was over. She knows the road ahead will not be easy, but she has a chance to financially survive.
If you know someone who has lost a loved one and the income that loved one provided, you might want to check up on them and make certain they are not only physically okay, but financially okay. After burying my good friend this week, I can use a few more hugs.