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Credit card debt and life threatening illness

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  • 16-09-2014 8:05pm
    #1
    ccdpt
    Registered Users Posts: 2 ✭


    Someone close to me has been diagnosed with a very serious illness - leaving them unable to work. He is not young, past retirement age, but for a very many years he has been juggling some fairly hefty credit card debt - usually around 15k but it has been as high as 40k. Now with this illness and totally unable to work, for the first time he has defaulted on the payment of the cards. Up until this point he was paying all the interest. This goes back nearly 20 years on and off.

    So basically I'm helping talk to the credit card companies. They are being pretty good as we are not being chased by debt collectors. They want us to fill in a statement of incomongs and outgoings - which is fine as it will show more outgoings than incomings - he is supported by the family to keep food on the table.

    One card company said they would offer a settlement - they offered to settle at 40% of the debt straight off. I said no - they said come back with an offer and it would be considered. However He also said once a card goes into 7 months in arrears, its effectively written off as a bad debt - but the most serious mark goes on your credit rating. We don't care as he'll never need it..

    Basically I want to know if we can just tell them no - they are getting nothing - and if they will eventually cross it off as a bad debt and leave us alone. Considering we do not know what the future will hold, health, and supporting his wife and keeping the lights on - no way I think he should give any money to the card companies - since he's paid them 18% interest on massive bills over 10 years.

    Any thoughts or advice appreciated.
    Thanks.


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    #2
    salamanca22
    Registered Users Posts: 1,179 ✭✭✭salamanca22


    If it's that high a debt it will most likely go through the courts eventually and if god forbid the worst happened it would be taken from the estate.

    I am not 100% sure too but if the debt was incurred after he was married then the wife might he liable too for the debt.


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    #3
    Jim2007
    Moderators, Business & Finance Moderators Posts: 10,041 Mod ✭✭✭✭Jim2007


    ccdpt wrote: »
    However He also said once a card goes into 7 months in arrears, its effectively written off as a bad debt - but the most serious mark goes on your credit rating. We don't care as he'll never need it..

    Just to clarify this, when a debt is written off in this manner by the card company, it does not mean it goes away, they usually just sell it on to a debt collector who then tries to collected it!


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    #4
    hfallada
    Closed Accounts Posts: 4,180 ✭✭✭hfallada


    The family need to contact a financial advisor like MABS. You have to question how someone can constantly be living beyond their means to that extent, for some many years. €40k on a credit cards is an insane amount of money. A credit card is only for short term borrowing. The credit card company is no going to write off the debt entirely. Settle for a massive write off.


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    #5
    ccdpt
    Registered Users Posts: 2 ✭ccdpt


    salamanca22 wrote: »
    If it's that high a debt it will most likely go through the courts eventually and if god forbid the worst happened it would be taken from the estate.
    Basically there is no estate. He's got nothing.
    salamanca22 wrote: »
    I am not 100% sure too but if the debt was incurred after he was married then the wife might he liable too for the debt.
    This is not true. Google "What happens to debts after death? - Citizens Information" (Cant post links)
    Jim2007 wrote: »
    Just to clarify this, when a debt is written off in this manner by the card company, it does not mean it goes away, they usually just sell it on to a debt collector who then tries to collected it!
    The credit card company told me in this case they will absolutely Not sell it off to a collection agency. They said when something like this happens they take you out of the normal pool of people in debt and treat it as a very special case. This is with one of the companies with the majority of the debt. I'm not sure about the other one yet.
    hfallada wrote: »
    The family need to contact a financial advisor like MABS. You have to question how someone can constantly be living beyond their means to that extent, for some many years. €40k on a credit cards is an insane amount of money. A credit card is only for short term borrowing. The credit card company is no going to write off the debt entirely. Settle for a massive write off.
    Spare me the lecture please, we are where we are. It was 40k at one time many years ago - its now about 15k. He paid off all that but has never been able to clear completely as working for yourself is not constant.
    We tried Mabs a while ago - honestly they were little help. Mabs is run by volunteers not experts. They said what we are doing is fine and they probably could not do any more. Perhaps we just got a bad person but we were far from impressed.


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    #6
    D3PO
    Registered Users Posts: 7,879 ✭✭✭D3PO


    ccdpt wrote: »
    Spare me the lecture please, we are where we are. It was 40k at one time many years ago - its now about 15k. He paid off all that but has never been able to clear completely as working for yourself is not constant.
    We tried Mabs a while ago - honestly they were little help. Mabs is run by volunteers not experts. They said what we are doing is fine and they probably could not do any more. Perhaps we just got a bad person but we were far from impressed.


    Wind your neck in. Somebody has taken the time to respond to you in a constructive manner. If your going to come on here with such a query aswell as a response it would be remiss of somebody not to point out that credit cards should be for short term borrowing.

    if your not prepared to accept all of what somebody is going to say these forums arent for you.


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    #7
    Jim2007
    Moderators, Business & Finance Moderators Posts: 10,041 Mod ✭✭✭✭Jim2007


    ccdpt wrote: »
    The credit card company told me in this case they will absolutely Not sell it off to a collection agency. They said when something like this happens they take you out of the normal pool of people in debt and treat it as a very special case. This is with one of the companies with the majority of the debt. I'm not sure about the other one yet.

    Make sure you get all of this locked down in writing.
    ccdpt wrote: »
    Mabs is run by volunteers not experts. They said what we are doing is fine and they probably could not do any more. Perhaps we just got a bad person but we were far from impressed.

    MABS does a very professional job, but they can't magic a way debt either!!! what did you expect???


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    #8
    SBarrett
    Registered Users Posts: 160 ✭✭SBarrett


    I don't know why you think you can refuse to pay them and tell them they are getting nothing and think they will just go away? I understand that this person is very ill but they did spend someone else's money and they are entitled to get their money back. Offering to wipe out 60% of the debt is an incredibly generous offer.

    If his debt is passed on to a debt management company, there will be no understanding.

    Steven


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    #9
    irish gent
    Registered Users Posts: 240 ✭✭irish gent


    A friend of mine he owed 5k .He lost his job and told them he cant pay it back . two years it went on with the odd phone call saying he cant pay .They in the end scraped the payment. but he will never get another card from any other company because of his poor ratings.


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    #10
    wmpdd3
    Registered Users Posts: 9,624 ✭✭✭wmpdd3


    OP, does the guy own any property as in his own house? if not a drn would be suitable, it's a form of bankruptcy. mabs can help with this.


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    #11
    fAzI
    Registered Users Posts: 275 ✭✭fAzI


    wmpdd3 wrote: »
    OP, does the guy own any property as in his own house? if not a drn would be suitable, it's a form of bankruptcy. mabs can help with this.

    Do you know any consequences after DRN?
    I know you can't get any credit card in the future, but what else?

    Thx


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    #12
    phormium
    Registered Users Posts: 3,302 ✭✭✭phormium


    MABS are experts in cases like this but they can't just get rid of it either but can advise (BTW they are not volunteers, they are paid experienced staff, you must be thinking of Citizens Information which has mainly volunteers).

    I would suggest going back to MABS as there are more options in place now with the Insolvency legislation than there may have been when your friend originally dealt with them.

    If he truly has nothing to give or likely in the estate then to be honest I would forget about it, just let the companies take their course, trouble is the letters etc will keep arriving so maybe just deal with that stuff to keep the hassle from him. Far bigger amounts have been written off and never paid in this country over the past few years, this is a drop in the ocean and the person has far bigger problems right now.


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