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Mom filing bankruptcy - laying the guilt trip on me

post #1 of 35
Thread Starter 
I wasn't sure where to put this, so I hope this is in the right place. I lurk here a lot because I get such great tips. This is a long post, but please stick with me.

Dh is 53 years old and I'm 38, so we've had many years to learn lessons about money. From his youth, dh has been taught to be wise with money, I've always been frugal, so subsequently the only debt (which I don't really consider debt) is our mortgage. We live waaaaay below our means to keep ourselves financially fit. Dh despises debt and keeps tabs on our money so tightly he can tell you our net worth at any given moment. :LOL

The problem is my mother (divorced), who lives with us. She's retired and receives a small SS check each month (about $500). She pays for nothing here, except her cigarettes (she smokes outside) (she quit smoking 4 months ago!!!!) and if she wants to go out and get a hamburger or something, gifts for friends and family on those occasions. Sometimes she pays for her own gasoline. If we go out to eat together, we always pay. We even bought her a brand new car 5 years ago (paid off), pay for insurance for that, as well as the yearly plates. (That car was totaled in a freak accident in which it was parked, of all things. We bought her a "new" used car with the insurance money. We were careful to buy something that wouldn't cost as much to own as far as insurance and title goes.))

Before moving in with us, over the course of years, she acquired a TON of CC debt and also had a surgery (no insurance). When she retired, we took on giving her $500/ month to help her pay for her credit cards. You can imagine how incredibly P.O.ed this makes my dh. Here he is without debt for 25 years and mom moves in and he's paying off credit cards that aren't even his. And in addition to that... somehow, she is still racking up charges on her credit cards and not getting them paid down. Trying to respect her privacy, I haven't asked about this, but it bothers both dh and me. But she also rents her home, so all told, she's bringing in close to $1400/month (the house is gone now in bankruptcy).

Where am I going with this? Well, dh drives a 12 year old oil-leaking Toyota with 170K miles on it and we need to start thinking about getting a new car in the next couple of years (this has been totaled by my nephew now). Dh wants to save the money and pay cash for a new Camry or Accord - he avoids even car loan debt (we got a Nissan). When we told mom that she has to stop spending money (and I cannot for the LIFE of me see where it's going... unless she's giving the money we give her to my sister, which would REALLY tick me off) she got upset. Then we told her that we really need to use the money we give her to save for a car. She gets upset, mutters something about "but you'll keep dd in private school" (and she is still there) but says, fine, I'll just file bankruptcy on my credit cards. She has no bills but cc bills and annual property taxes (and some hospital bills we didn't know about when I posted this).

Of course I felt guilty, but then said to myself "Hey, I've two sisters who do nothing to help her, who has kids that drive better cars than we do, all because we help support mom. I'm tired of it." We live in a smaller older home when we could have a big new house because we have other priorities (dd's private education for one, helping mom as another). I mean we pay for EVERYTHING, including her car, and now she's laying a guilt trip on me. I figure that I've gone beyond my obligation to her and I'm gonna let her file bankruptcy because we WILL have to buy a car soon. But then I start feeling guilty again and wonder if there is something else I should do. (We did let her file bankruptcy and she lost the house in it to pay off cc.)

But the big question is can she even file bankruptcy? She hasn't missed a single payment for years on any of her bills. She has decent credit. Also how will it affect dh and me? We have one credit card, which we never use (for emergencies, only) that has her name on it too and we currently have one joint bank account with her. Is this going to ruin our credit? Do I have an ethical obligation to try to help her pay off her debt? We have plenty of home equity and I'm afraid the courts will tell us to get a loan to help her. Can they even do that?

Anyway, if you read this far... thanks and if you have any advice... thanks. We'll be talking to a lawyer soon, but I thought if anyone has thought now, it might help me with my guilty feelings.

Edited to add: and all of this comes on the heels of dh using a small inheritance nest egg he'd been hoarding to build a two room addition onto our house so that my mother has her own area. Why do I feel guilty??? : I mean surely, we've done enough.

New edit: I never talked to my sisters to help out. I got over feeling guilty. More info in another post at the end of the thread, although I'm not really sure why anyone would be interested in this *now*. It was a very specific and personal situation. I took a lot of the advice both from this thread and others that I had posted concerning this. You all helped out greatly. Thanks again! I tried to update some stuff in the post to apply to where we are today. I added a post, too.
post #2 of 35
I've never been in your situation, but I think you have done plenty to help your mom, and you are certainly entitled tosave your own money for your own car!
And kudos to you for helping her out so much to date!
Sorry I can't be of much help!
post #3 of 35
Let me say first that you and your dh have been more than generous with your mother. I don't think you should give your mother another penny. You provide a room, food, transportation, and love. You should not allow your mother to hurt your family financially. Don't feel guilty, but see a lawyer and make sure that you are not on any joint accounts with her. Your mom sounds a bit selfish (sorry). Let her take the fall for her own bad financial decisions. YOU HAVE NOTHING TO FEEL GUILTY FOR. If any of my children will let me live with them when I'm old , I will feel like I've been blessed.
post #4 of 35
Sounds like she's taking you for granted. I'd get off the joint accounts immediately -- get separate bank accounts for you and dh / her and take her name off your credit card. If (ok, when) she complains, tell her it's time to grow up and SHE be the mom and you be the daughter, rather than the other way around.
post #5 of 35
post #6 of 35
Hrm. Yeah. Come to think of it, I don't think your mom can just decide to file bankruptcy without any real reason to. A judge, if it got that far, would probably say: tighten your belt, stop using your credit cards, use your spending money to pay down your debt like everyone else, use your cigarette money, use your rent income, get a job, sell your car as last resort. THEN, if none of that is doing anything and if somehow the finance charges are higher than the max payments you can make and the credit card companies aren't willing to work with you AND you can't consolidate your debt with a non-profit helping agency, THEN you can consider filing for bankruptcy.

But really, with you guys providing her with a home and taking care of her expenses, she has nothing to complain about. Heck, just providing her with a home is a HUGE amount of money she doesn't have to come up with on her own. She's a grown woman. She should be able to handle this.

I know I don't sound very sympathetic toward her. But I tried to figure out why this scenario sounded so familiar, and it reminds me of the "user" relationships so many friends got into the first time they started dating. (You know, one person pays the rent and works the jobs, and the other one sits around and plays video games all day.) And then I tried to picture one of my parents treating me like that first boy/girlfriend. And . . . yeah . . . I guess I just don't have much sympathy for someone who's been offered such a generous, open-hearted gift and is using it as a weapon in the relationship.

Good luck with everything! And please don't let her make you feel guilty!!
post #7 of 35
Actually, I believe that anyone can claim BK if they want to. My understanding, is however, that sometime in the near future (2006 maybe??) an new BK Reform Bill will go into effect. This new law, as I understand, does specify parameters for claiming bk. I don't think your mom would qualify for bk then.

To be honest, I'm not sure if you having her name on your cc account would affect your credit. I would think it would not. Because if you're late on the payments, it's not her credit that gets pinged, it's yours - because you're the responsible party on the card. As for the bankaccount, I have no idea. Personally, if it were me, then I would cut all financial ties to her due to the bk. Once something is on your credit, even if incorrect, it's not always easy to get it off. (My dh is the victim of identity theft and we battle this).

Lastly, I am SO sorry you're going through this. All I can say is that I think you need to do something to protect your own family. It's not fair to your dh that he deals with this. If my dh's mom was taking advantage of us like that, I would be very hurt if he didn't do anything about it. It may sound harsh, but if it were me I would sit down and go over where her money goes. It can be done in a positive light, such as, "Mom, we need to talk about money. Dh and I need a new car. You seemed anxious about us not giving you x amount of money each month. I'd like to figure something out, so let's go over your budget and expenses." IMO, if someone is receiving support from me and their financial obligations still aren't being met, then that opens them up for investigation.

It's hard to confront, at least for me, but...really....go back and read your post. This is draining you. I read frustration, some sadness and a little resentment. Maybe I got that wrong - if so, then excuse this post. But if I'm right about your feelings then I believe that you need to take care of yourself, your dh and your dc, by fixing this situation so it works for not only your mother but your whole family. Mom's a big girl.
post #8 of 35
I would agree that you should get her name off any joint accounts, and then if she can not make her payments on her own, she should declare bankruptcy. It's outrageous that your family is paying $500/month towards her debt. If y'all have nothing better to do with that money than at the very least it ought to be going towards your retirement savings or your daughter's college savings. Paying off your mother's debt is just not your job.

Okay, as far as the bankruptcy filing, it is not as bad as some PPs are making it out to be. They do not necessarily make a person sell their car (only if it is worth above a certain amount, and already paid off) and if you are not working they don't "make" you go get a job (a lot of people declare bankruptcy due to trouble finding a job in the first place). They look at what your expenses and your income are, and if the income is not sufficient to pay basic living expenses in addition to the CC payments, your CC debt gets discharged. It actually really is just that simple for a chapter 7 bankruptcy. I don't think the judge can decide you're not "worthy" of bankruptcy or you haven't tried hard enough or whatever. They honestly just look at income vs. expenses and assume nothing about your current situation will change. Now since your mother has that asset of the rental property her situation is a bit more complicated and she may have to do a chapter 13, where she gets put on a payment plan to pay, typically, 25-50% of the debt over 3-5 years, and then the balance is discharged (it goes away).

Yes, it will destroy her credit for a while but what does she need good credit for anyway? I mean honestly? She has a place to live and she has a car. What else does she need that she needs credit for?

As for why the balances are not going down, are you sure it's because she's still spending? It may be that she is making the minimum payments but has interest rates at 29% or higher. At that rate the balance goes UP, not down, just from the interest. It is actually rather hopeless when one is in that situation.

The new laws on bankruptcy are not as dire as they have been made out to be by the media. I would urge your mother to go see an attorney...but I also think you should steer her in that direction and then put some distance between her money problems and yourself. It just shouldn't be your problem to solve.
post #9 of 35
One positive part I can see about her filing bankruptcy would be, then she wouldn't have good credit and wouldn't be able to get more credit cards (for a while). So she wouldn't be charging new stuff at least, it would limit her means to what she actually receives in SS each month

You have provided, as others, said, a home, food, the loving company of your family - with her $1400 a month or whatever, she should be able to pay for extras, gifts, and her bills! If she can't pay her bills - well, I guess she should either declare bankruptcy or borrow from someone else. I think to declare bankruptcy you have to stop paying your bills for a while, anyway, and be "in default" to file - you can't just go from paying perfectly every month to bankruptcy the following month!

I think you should stop paying the $500 a month in any case. This is really unfair to you & your husband.
post #10 of 35
post #11 of 35
Originally Posted by traceface
One positive part I can see about her filing bankruptcy would be, then she wouldn't have good credit and wouldn't be able to get more credit cards (for a while).
This isn't really true. Dh filed bk in 95, before we were married. We were together and had combined finances and he started getting cc offers about a month after discharge. They were 30% interest rate cards, but they were available. A friend of a friend bought a brand new card the day after her bk was discharged at a 25% interest rate- again, way high, but available.

The new bk laws are in effect next month I believe and she can't just discharge debt-there are income requirements, and most of the time they'll set up a 5 year repayment plan. If she tries or just stops payment on anything you have jointly, they'll just come after you anyway. Separate all of your accounts. Get her name off anything of yours and your name off anything of hers.

You've done MORE than enough for your mom. If she wants to know hardship and struggle, you can tell her that she's always welcome to move back to her own home and give back the fully paid for car you gave her. She can also start paying her own insurance, etc. While you're doing all of this for her, she's got no real reason to curb her spending on other things.

If you DO want to continue to help her pay her bills, I would insist on seeing the bills and paying the creditors directly. I'm sure she won't like that and will complain that she's being treated like a child, but it seems as though she's acting very childisn. Complaining that you won't pull your dd from private school to pay HER debt???!?!?!? How much more selfish can someone get?

I know you want to do right by your mom, but you've also got to take care of yourselves.
post #12 of 35
What elphaba said. You don't have to be in default to file. You just show that your income is not adequate to pay the CC payments on top of living expenses. A lot of people make perfect payments while they are still collecting unemployment benefits, for example, or entirely drain their savings before their income situation improves. Then the money abruptly runs out and they simply can not pay anymore. In that type of scenario one may as well file immediately rather than stall and default. In fact it is better for one's future credit rating to have not been in default for a long period before the bankruptcy. Not saying that makes sense, but that's kind of how it ends up working.

A very sad situation is when people cash out their retirement savings to pay CC debt and eventually declare bankruptcy anyway--in a bankruptcy your retirements savings, as well as quite a few other assets, are entirely exempt.
post #13 of 35

everyone else has already said what I would say

Get her off your accounts NOW!!
put the ad thing in the paper that says "as of such and such date mr. and mrs velochic will not be responsible for debts of velochics mom " as well.

let her drive the leaky toyota and you and dh take the good car you gave her-sorry I just wanted to scream for you when I read this.
My mother would love it if dh and I could do all of that for her and wouldn't be snotty about it either. I agree with the pp if she keeps on tell her she can move back to her home...

you and your dh have hearts of gold and much patience. I admire you. I wouldn't have made it this far ...
post #14 of 35
The new bankruptcy law comes into effect October 17th, 2005. After this point, everything involved in declaring totally and completely changes, and it's being made especially difficult to get the kind of bankruptcy that discharges all your credit card obligations, since the credit card companies basically wrote the bill changing the laws. I would think that someone in your mother's situation would be, as they say, SOL in that case.
post #15 of 35
Thread Starter 
Thanks for the replies. I'm trying really hard to reconcile my feelings about this. I don't know if anybody else has a parent like my mother, but somehow you can say the most innocent things to her and go away from the conversation feeling like dirt. She just has this way of making me feel like I'm 14 again. And nothing is ever good enough. I swear, the woman can't say something nice about anything. Sometimes I really hate the negative energy she brings into this home.

Anyway, we've canceled the credit card and tomorrow, we're going to the bank to get her off of the account. Then she can do whatever she wants. My cousin is an attorney and she is coming over for dinner this week to discuss filing bankruptcy with my mom. I've told her (my mom) that I want to be present at any discussions because there are questions I have as well. We'll see what happens. Yesterday dh said under no circumstances are we going to put ourselves in a financial bind because of her careless spending, though. I agreed with him and told him that I would support any decision he makes.
post #16 of 35
I would encourage you to contact your own attorney, not a relative, privately, to make sure that cancelling the card is ALL you have to do to protect yourself.
post #17 of 35
You've done more then enough - you've done TOO much. Quite honestly (and not to put you on the defensive or anything), but you have actually been enabling her - she's living high on the hog and not having to face any real responsibilities because she knows you will do it for her. If I were you, I'd stop giving her the $500/mo for the ccs and I'd cancel her authorization to use my cc... she is NOT financially responsible enough to have that kind of access - nor does she need it.
Time for momma to face her own responsibilities. As for teh bank account - is it checking? Do you write checks on it? If so, I'd watch it carefully - if she causes any checks to bounce, or withdrawns unapproved cash - I'd close it.
If she files bankruptcy, she may lose her house... and her $700 rental income from it. Remind her of that - it will also certainly damage her credit. With the situation you described, she should have no problem continuing to make payments on time for the cc debt - IF she stops charging now. I'd want to see what she's been charging... any way you can see her statements (maybe even sneaky, if needed?)?
And.. as for the comment about your child's private school... let's just say your momma is lucky she has YOU for a daughter and not me. Any grandparent in my life who would put her own selfish wants in front of her grandchild's education would be touring nursing homes.
post #18 of 35
Very good advice all around! And hugs to you for going through all of this. I don't want to overstep myself here but this sounds so very familiar to me from my histore with my grandmother.
Please look at the books "Stop Walking on Eggshells", "Boundaries", "I hate you, Don't leave me" and possibly "Understanding the Borderline Mother"
These may or may not be applicable to your situation, but reading this, it really sounds like she is being emotionally manipulative and destructive. My grandmother and mother don't speak right now because my mom finally, after 40 years of this very under the radar abuse, said "You may not do this to me and my family anymore" I am so proud of my mom for sticking up for herself and her family, and it was like coming out of a storm when we all started setting boundaries. We have told her numerous times that if she will get counselling and refrain from treating us like that we can be in each others lives, and she still will not change her behavior. But we finally learned that (drumroll)

WE are not responsable for her behavior!

You are only responsible for you. Not her.

Look into those books, read them, or don't read them, but look at them at least.

Feel free to PM me with any thoughts or questions!

Hugs Hugs HUgs
post #19 of 35
Yep, what they said!!

She is taking advantage. You need to put you and your family first and her SECOND!! I would also trade cars. You have the children, they need the safest car; then the breadwinner; then whoever is left (if there are that many cars).

"Boundaries" is an excellent book. You may actually want to do some couseling with you and your dh. Sometimes an outside voice helps.
post #20 of 35

add the book toxic parents

to bella babes list.
and please please really consider the pp idea of having mom move back in her own home. It sounds like she is a major source of stress and strife in your home and marriage.
You and your dh do NOT deserve to be treated this way and the kids shouldn't think it is ok for gma to treat their parents like dirt......
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