Debt collectoins and home.

[Charles Gray]

This is For a home in California.

I am executor for my fathers estate, and holder of financial power of attorney for mom. Mom is 81 and dad had several credit cards out at the time of his death. Currently Phillips and Cohen is wanting money for the Sears Mastercard, in the sum of 10,000 dollars, but they say they'll settle for 8000.

The problem is, we don't have the money. Right now, our combined assets are 900 dollars in the bank, going up with her retirement and SSI. I can't work because she needs to be tended to pretty much 24 hours, as she has a minor case of dementia, verbal aphasia and so sometimes does strange things and more importantly couldn't call for help if something happened.
The home was valued at 325,000 in 1993, and has 120K of mortgages on it, and dad filed a homestead exemption for it some time before he died, and mom would be able to take the full 150,000 exemption. The house also has a number of problems (holes in walls, damaged carpet, non-code plumbing), that would require a LOT of work before it could be sold-- and to be honest, in the current real estate market, where they couldn't even sell new houses, i doubt It could be sold no matter what.
Dad also left other debt, in the sum of about 7,000 dollars, not counting the mortgages.
I'll be blunt. The house is our lifeline. I've been watching after mom and dad for the last 10 years (mom alone for the last year after dads death), and because of that, it'll take me some time to get back into the job market. If we lose the house, we lose everything and mom has had to come home early hte last two times she went to the hospital, because she reacted so badly to it. Losing the house will kill her, literally.
The house is currently held with mom as life tenant and me as the remainder man so title passes to me.

What is the chance that they could force sale of the house? If it gets to that, could having mom do a chapter 7 bankruptcy save the house? Note, I don't care about a sale lien (or whatever the term is for them having a lien when the house is sold for some other reason), and I'd pay it once I have returned to the work force after mom passes away.

Note, we cannot pay this debt. Not at all, not right now and probably not for some time. If they would allow small payments every month we coudl, but they want the 8,000 as a lump sum or in three payments, and we do not have the money for that.

So, again, what can I do to protect the house?

Edit: Gah, sorry about the collections oops. I'm just a little upset right now.

[Ladynred]

First, get a quote from a real estate agent on the value of the house as it stands right now and get it in writing. The need for major repairs will reduce it's value considerably in addition to the existing mortgage against it. If there is no equity, or if the remaining equity is below the Homestead exemption, then P&C would have a hard time seizing the house to force a sale just to get 10K out of it. Phillips & Cohen are a bunch of slimeballs, they make a lot of threats.

Filing BK might be an option, however, your mother would have to be at the 341 meeting to answer questions from the Trustee, and it sounds as if that wouldn't be something she could do. You might speak to a lawyer to find out if it's possible to get around that, perhaps via interrogatories.

The other possibility, is a reverse mortgage, you could look into it. That would have an impact on your mother's estate where the house is concerned.

[Charles Gray]

Originally Posted by Ladynred

The other possibility, is a reverse mortgage, you could look into it. That would have an impact on your mother's estate where the house is concerned.

Thanks for your advice. I'm very wary of a reverse mortgage-- I've heard horror stories of what happens after the holder dies, and unfortunately, the house is all I have to get bck on my feet when mom passes away.
If they put a lien on the sale of hte house it'd be no problem-- once I'm working I can likely pay it off, but the seizure of the house would be just disastrous.
(As a after comment, I love how the states deal with old people. No help, no aid, no nothing-- unless of course you lose everything in which case they might deign to help a little. You would think someone would realize that it's ctually more cost effective to have family members take care of the individual, but nope).

[annajosie]

This is just a thought. A reverse mortgage might be an option for you and your mom. I don't know if she could get insurance on it so that in the event of her death, the house would be paid off.

That might help you out to some degree. I know people who have taken out reverse mortgages, and I know that they are offered the option to have life insurance to cover the mortgage, but I don't know what the cost would be.

Good luck to you,

[debtcollector`]

You have a conflict of interest. You cannot handle your parents' business while seeking to serve your own self interest. Decide who you care about - Mom and Dad or yourself and come back for advice.

DC

[Charles Gray]

Originally Posted by debtcollector`

You have a conflict of interest. You cannot handle your parents' business while seeking to serve your own self interest. Decide who you care about - Mom and Dad or yourself and come back for advice.

DC

Problem is, in this case they are one in the same. Mom doesn't have anyone else to take care of her. She won't survive a retirement home, which is the considered opinion of her doctor.
That leaves me.
on the other hand, if I make no preparation for preserving the house, then I'll likely be homeless, with no way to recover when she dies, which is not a good psychological state to be in with a disabled parent. the only other suggestion I got so far from a "friend" was to put her in a home and sell the house and take the money which is A. Illegal (power of attorney isn't license to loot the estate for yourself) and B. wrong, as she dealt with my fool ass for the first 18 years of my life.

The annoying thing, the REALLY annoying thing, is that this is the only debt that seems impossible to deal with. I'm working at home now and pulling in some extra money, and if things (cross fingers) do well, the day to day expenses will be solved. but not the 10k one which we couldn't have handled even before dad died.
I've looked into a mortgage but even the reverse mortgages are getting harder to come by out here-- the California real estate market is just collapsing.

[anteater]

Just passing by.... But what effect does this statement tucked away in OP's first post have on the situation?

The house is currently held with mom as life tenant and me as the remainder man so title passes to me.

[debtcollector`]

Originally Posted by Charles Gray

then I'll likely be homeless, with no way to recover when she dies,

Then you are a dirtbag who is using your legal position to take advantage of poor disabled mom. You have decided who you are going to help and it isn't your mom. Shame on you.

DC

[Charles Gray]

Originally Posted by debtcollector`

Then you are a dirtbag who is using your legal position to take advantage of poor disabled mom. You have decided who you are going to help and it isn't your mom. Shame on you.

DC

No, I'm someone who quit my job to watch after my father, and put my entire life savings into keeping them in their house. That is my filial duty to them. It is not a pleasant duty, and would be very easy to abandon, whereupon I would not have to watch my mother degenerating day by day. I could go back to work and push it off on some nice assisted care facility where they would have to strap her in bed as they've had to do every time she goes to the hospital because she panics and becomes violent.
However, that is not my right. My duty as first son is to watch after her. My second duty is to watch after myself so I can continue to watch after her, as if I go, there is nobody else to do this duty.

But then, since your profession is ruining lives, I doubt you would understand that. I must be nice being of a kind with the noble Mosquito, hagfish and blowfly larva.