All Forum Posts by: Deborah Smith

Hi @Joel Petersen

I am in the Phoenix area. I am not a RE Agent, but am planning to get my license in the near future for the same reason and will be in the same boat. Will send you a colleague request.

Welcome to BP.

I think a big question would be: What would your living situation be if you sell your house? You coud buy again, but probably something smaller at the now higher prices. Or you could rent - but would renting take up more monthly cash flow than your mortgage payment? Would that matter?

Just food for thought. We are in a similar situation with significant equity in our primary home, but it would cost far more to rent or buy something that would meet our needs, so it makes sense to stay put and find other money for investing.

Thank you all so much for the replies and suggestions. I will check out that book, @Duncan Taylor .

@Bryan Scott - I like this approach (because it makes sense for her) and am hoping that now that she's realizing the situation she's put herself in that she will be more receptive to implementing some (or all!) of these steps.

Had lunch with her today and she suggested I buy her house - claims she was joking, but clearly it's a thought in her mind. So we will continue discussing further to see if it's a viable option for all parties.

Again, thank you all :)

Thanks Jon. Agree - 110%.

Long story short - we won't support her financially. Help, yes, support, no. We've tried too much for too long and she hasn't been willing to help herself. She also will never live with us, as we value our marriage and she likes to create drama. She is also a hoarder, which is not an issue I am willing to deal with in my own home (or rental property). I think at this point I'm just grasping at straws to try damn near anything to get her to help her situation. Thanks to all for your input!

@Duncan Taylor

Thanks for your input!

I think either way this goes selling the house will be priority #1. She can't afford to fix it, and it needs help. I'd rather her sell it now before she ends up in foreclosure and loses the opportunity to get SOME money out of it.

She can't afford an apartment anyway, so co-signing will probably be in order, regardless of her credit situation. I realize this may limit some of her options.

Another thought - what about paying the minimum payment in order to maximize cash? Sounds insane, I know, but cash flow is a huge issue here, and we're working on the assumption that when she passes there will be no estate to pay the debts, so the amount of interest accrued is somewhat irrelevant.

@Jon Holdman

100% Agree. We attempted to work out a budget with her approximately 4 years ago when there was still some savings left. Problem was that she was already living in the red, and refused to make any changes to her lifestyle. It is clear she expects us to step in financially.

She would likely sell her house, and move to an apartment, so she would have some cash available at that time. But since she recently learned that she won't qualify with $856 a month income for any apartment (co-signing is a potential option here, we're exploring), she thinks a possible "plan B" is for her to stay in her home. (Safety is a huge concern for us - her personally, slips and falls type stuff, not the neighborhood-, so we have been encouraging the move).

$12k won't generate income, per se, or provide MUCH to live off of, but at lets say $600 a month for a cheap apartment, that would give her roughly a year and a half of rents covered. Which is a HUGE impact when you only bring in <$900/month.

Agree - she will not net the full 401k amount. For simplicity sake at this time I am assuming that even post-tax it'll be just enough to wipe out the debt with nothing left over.

Additional thought (gives away my take a little more!): Does she need to be concerned with her credit situation if she will not be applying for credit again for the rest of her life? Not meant to be answered independently, but just a thought on whether paying off the debt is necessary at this stage and financial situation. (Disclaimer: I would never advocate someone run up debt of any sort they knew they couldn't pay off, but it happens).

I am trying to reserve my opinion so that it doesn't appear to her that I am trying to sway anyone's thoughts one way or another.... but I am sure by my posting this one could read between the lines.