- May 25, 2024
- Posted by: legaleseblogger
- Category: Related News
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### Financial Struggles and Considerations
Here is the scenario. My husband was the breadwinner for years while I stayed home with our child. We are renters, own nothing at all. Child off at university and I joined the workforce during Covid, and spouse lost most of his income due to the pandemic. Fast forward to last year- spouse got diagnosed with autoimmune disease that has him crippled in pain (his work is physical), and now has suffered a mental breakdown and is not able to function, let alone work. I was laid off from my job at the end of December. So him on disability (barely anything), me on EI, and we are completely unable to pay our debts. Our debt is close to 90,000 between credit card, line of credit, and CRA. We can’t pay. The money that’s coming in is just enough to pay for rent and bills and food.
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### Exploring Options and Seeking Advice
I’m not sure what to do. I can’t sleep at night and my health is suffering. Is there anything else that I can do that I’m not aware of? Obviously getting a job- I’m constantly applying (daily- hundreds of applications since December. Two interviews. Nada). My spouse working right now is out of the question- hopefully in a few months he will be better and can slowly get back into the game, but for now, it’s not going to happen.
That debt was accumulated over 20 years; I was always paying minimum payments and the CRA debt was the result of a total inept accountant. While my husband was employed, it was just standard practice to pay minimum payments and not thinking about the possibility of him not working. I know, totally irresponsible.
Any advice gladly accepted. And please, no judgment needed. I know I was financially irresponsible.
### Conclusion
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****** just grabbed a
Don’t ask your parents for money. If you’ve been in debt consistently for the past 20 years, you won’t magically change your ways, and you’ll put your parents in a vulnerable situation at the same time. Don’t do it.
Look into the consumer proposal and consider moving in with your parents.
Get assistance with your resume (even on Reddit, if not an employment centre, or chat GPT) and improve your interviewing skills. You’re feeling the pressure, but you have to mask that desperation in the application process.
You’ll get through this!!
>I will need to either go bankrupt or consumer proposal, which will mess up my credit rating for a long time.
With low income and massive debt, your credit rating should be the least of your worries.
Speak with a licensed Insolvency trustee for your options.
Don’t ask your parents to refinance. That’s the worst plan.
Bankruptcy, that’s a massive debt. > I don’t think HELOC is the best option as the house needs to be used as collateral The house would be used as collateral for any money you’d want them to extract from it, and would be “on the line”. Regardless, that’s an extreme burden to place on your parents at their age. Like the other poster said, credit rating is the least of your concerns. Look into bankruptcy, try to move in with your parents and focus on getting yourselves back on track.
Since neither of you is working, could you move in with your parents (after speaking to a licensed insolvency trustee)?
Claim bankruptcy, not as bad as you think
Your parents are probably counting on using their money for their retirement, not bailing out their adult child. The interest rate on a HELOC or refinance might be lower than your current debt, but that isn’t going to change the fact that you have a large amount of debt that you didn’t pay off when you could have and which could now take you a long time to repay.
Credit score should be the least of your concerns. If your spouse is on long term disability and you aren’t employed you shouldn’t be looking to take on new debt. You couldn’t even afford to do that when your spouse was working.
Speak with a licensed insolvency trustee.
Go ahead and be honest and tell your parents that you are doing this. Your parents aren’t responsible for your decisions. They could choose to offer you some kind of support that they are comfortable with. Or not. That is their choice.
100% insolvency is the way to go.
I would never burden my parents by asking them, they will need that money to live soon enough.
I went through a bankruptcy myself, it was by far the best decision to make. After discharge I had a pre paid credit card in a month, rebuilt my credit from there and now a very happy home owner.
People fuck up, life throws curve balls. Insolvency is a tool, put it to work for you!
Can I ask why it matters what your credit score is? Not in a mean way, just wondering. You already rent so unless you think you might lose that place and have to look for another (needing a better credit score) it wouldn’t affect that. You already have high balance credit cards, so you’d prob not want to get another even if it was somehow offered, and if you get out of this debt without a consumer proposal it would take years to save for a down payment for a house anyway (not sure if that is a plan or not) so you wouldn’t need a good credit score for that right away. I just see no reason for good credit if you can’t pay your debt anyway.
I honestly have not been in that situation but from the sounds of others comments a consumer proposal could be a great option.
If your husband has been working and paying into CPP you might get him to qualify for medical retirement. Does he have a pension? If it’s a good plan he could collect his pension and CPP-Disability (CPP and some pensions can be taken early without penalty because of medical disability). If he recovers, he could always go back to work but by the sounds of it he won’t be able to for at least a long time. Make sure you’re applying for the Disability Tax Credit, which gets you a significant savings on your taxes which would go towards your CRA debt.
I would do a consumer proposal to be honest. You could always consider temporarily moving in with your parents if they are ok with it but when you move out you might have sticker shock at the cost of rent now adays (I’m assuming you’ve been where you are currently for a long time so aren’t paying today’s market rent). I wouldn’t do anything to mess up their finances, this is your problem to solve.
Based on your reddit history, your dad is a serial pedophile who abused you and multiple family members. But you’re implying that he’s going to agree to have 90k worth of your debt leveraged against his house? You’re in your 50s, so your parents are at least in their 70s, and you think they’re going to consider borrowing against their house to pay off drug, alcohol and fast living debt? According to your comments, you and your husband are separated, and the debt was acquired due to addictions and being irresponsible. Declare bankruptcy. You can probably add your lease into it as well, since it’s one of your issues in the separation from your husband.
Declare bankruptcy and start over but don’t get into more debt. Learn to live within your means. You need to get back to work.
Renting, on EI/disability/fixed govt income, plus no assets is the best position to be in to claim bankruptcy!
You will also need to take a hard look at your money in vs money out because it sounds like the 90k is mostly consumer debt?
Bankruptcy, you are the exact situation where it makes sense. It hits your credit rating but honestly the time flies by and then you are back to good credit. Get a secured credit card after 1 year, $1000 limit tops, and pay it off every month in full. Do not get back into debt.
Don’t drag your parents into your debt, chances are you won’t be able to pay them back either.
File for bankruptcy. It’ll ruin your credit score but this is Canada we’re talking about, you’re not going to be able to afford a house.
Ask your parents if you can move back in, such as the basement to save money.
Do not get anymore loans. Learn to budget, cut costs.
Go in person if you’re applying for jobs.
In your other post 3 days ago you said that you’re leaving your husband? While he’s sick? K, have fun with this.
Edit: after reading through all your other posts, you need a LOT more than financial advice. You need immediate therapy and separation from whatever has led you to this point in your life. Sounds like a life of bad decisions all coming to a head. Seek guidance, god, and professional help before it’s too late.
I think it’s a terrible terrible idea to borrow from your retired parents. You are going to put them into debt? Horrible idea.
You have NO income. You can’t pay them back
Go bankrupt.
> Other than this option, I will need to either go bankrupt or consumer proposal, which will mess up my credit rating for a long time.
Who the fuck cares about your credit rating it’s the least of your concerns. You’re drowning in debt, stressed the fuck out and worried about 3 numbers being bad? Go talk to a LIT, wipe it all out and start again. So much less stress when you just take that load off your plate. Source me, $80k debt cut down to a single payment affordable payment and the stress melted away.
HELOC or refinance, makes no difference except for what the rate will be & refi means static payments where HELOC means you can pay just the interest but that’s what you have been doing for 20 years; so you know that’s not the way to get out of debt. If I was your parent, there is no way; this close to or in retirement, that I would take on this debt for you. Your credit is already going to be shot with not paying your bills so CP or bankruptcy are valid options in your situation. It’s a tough situation. Makes me sad to read it but you need to pull up & take action. If talking to your parents and showing them everything financial will help; get that conversation started.
If you’re 90k in debt without income, your credit rating doesn’t mean anything. File for bankruptcy now. Your trustee can help you navigate your next steps, consolidate your loans, and have you discharge from some or all of the debt. Come up with wage garnishment for the remainder, most likely CRA portion. Your spouse is probably not going to well for a while, but in sickness and health, who can hold their vows?
>Does this make sense?
Not for the parents it doesn’t. Uncollateralized loans are great for the borrower, but shit for the lender. You’re scamming the lender, your parents, with emotional blackmail. This is shitty. Go to a bank or alternative lender if you want to borrow, which is probably dumb, but otherwise, improve your earnings by being more emplyable, not just interviewing often. Honestly, I’ve never not gotten a job I interviewed for. How are you appararently constantly interviewing and never being hired unless you are a shit candidate?
Robbing old people isn’t the way forward here. They have no runway to make up for your malfeasance. You do, so take upon yourself to fix this. Don’t take from old people with little flexibility in order to make your road forward smoother.
Also, if you racked up the debts over 20 years, how can you expect to get out from under them in a timely manner? Shouldnt you expect decades of negligence to cost you decades to rectify? Your expectations seem out of line with your circumstances.
Four days ago, OP posted that they were separated, but now they’ve reconciled?
You remained a SAHM even when your kids were teenagers? You could have been working nearly a decade ago to help your husband support the family financially. Obviously you knew the debt was accumulating and his income alone wasn’t enough. How do you even accumulate that much debt as renters?
You don’t have the knowledge, will power, or income to pull yourself out of this hole. You don’t understand finances or credit scores. Get the CP and move on with your life.
I don’t really understand what you were doing when your child was in school, so age 5-18. Why weren’t you working?
I’m sorry but this is so selfish. I understand that kids get sick and some need more supervision than others, but what was the reason for staying home with your kid until they left for uni? I don’t think this is a stay-at-home-mom situation, but a “I don’t want to work” situation. You knew full well that by doing that, you put your spouse in a vulnerable and dangerous position. That he wouldn’t be able to get sick, injured, or take time off even if he wanted to, because you decided to not work. If the kid needed extra help (like if they’re autistic, etc.), you still could have worked a part-time job or started a home-based business. There are always options. And especially with a husband whose job is physical. Sorry but you knew very well that you may end up in this situation, and it’s actually a miracle it took so long before your husband ended up needing help. Plus, you’ve been in debt for so many years, yet didn’t bother getting a job until the spouse couldn’t work anymore?
And now you want to mooch off your parents too? Their house is their money. It might be their source of retirement. And even if not, why do you feel entitled to their money? Especially since you have a history with poor money management and financial decisions?
You are an adult. You were supposed to take care of your husband financially as well, but you didn’t. In fact, most people try to take care of their parents too. Every time you ask them for help, you’re taking away their ability to retire earlier or enjoy life more. To be frank, this is exactly what you’ve done to your spouse too. Not to mention, you also put your child in a bad situation as well. Thank God the kid is all grown up; what would have happened if all this occurred when they weee 5 years old?
Jesus Christ.
No wonder that our generation doesn’t want to get married. It’s better not to with certain individuals as partners.
I filed for bankruptcy in 2018, I made 9 monthly payments and after that got myself ONE credit card to get my credit back up. It didn’t take long to get it back up. The bankruptcy is on file for 7 years but really it isn’t that bad. Unless you’re constantly getting credit checks and by buying things you shouldn’t be. As for your husband, maybe try and file for disability, because every little bit helps. I’m not sure if bankruptcy covers CRA, if not tell them your situation and they may be able to make a payback arrangements. Seriously look into bankruptcy. It’s not as bad as it sounds. Even just to talk to someone about it. What ever you do, good luck with everything! It totally sucks right now but it will get better! 💙
What in your situation is your concern about your credit rating?
Please don’t place this burden on your parents. I know it must be a very scary and stressful situation for you.
You have bad credit anyways, your cc is more than 30% outstanding. Just declare bankruptcy.
You need to take personal responsibility for the situation that you are in and find a solution that doesn’t include asking your parents for money. You are not entitled to any of their money. If any of my kids asked me to refinance my house to give them money to pay off their debts, I would seriously consider removing them from my will. You chose not to work when your family could not afford that choice. Now you are living with the consequences of that decision. Those consequences will be very uncomfortable for you and your husband. But they should never put your parents home at risk. Let your parents know that you will be filing for a consumer proposal or bankruptcy, and if they won’t change their account, they will lose money. Once you get these debts cleared out, do whatever you can to start making money and never spend more than you make moving forward.
I’m thinking declare bankruptcy because what else do you have to lose.
Also, don’t ask your parents to bail you out after making min payments for 20yrs. That’s on you and they’re older and possibly retired. Let them enjoy their old age and retirement while you and your spouse sort out your finances.
> I know, totally irresponsible.
There it is. Good for you.
Bankruptcy beckons. Do not involve your parents in this at all. If they can give you some cash off the books now and then for food etc that’s fine. But don’t involve their assets.
Bankruptcy. Credit means diddly doo when you cannot live. It’ll be seven years of pain, but you get to hit the restart button.
This is what bankruptcy is made for.
I work in HR and would be happy to take a look at your resume. I’d also be happy to give you some interview tips. Message me if you’re interested.
Unfortunately I can’t offer any advice but a consumer proposal with bad credit for 7 years sounds better than another 20 of minimum payments building yourself up to nothing.
Dont drag your parents into your fucks ups 🤦♂️ youre a big girl you can figure it out.
OP, bankruptcy will scrub the debt and the tax bill.
Don’t spend the next however many years repaying the debt (or repaying your parents) when the money to service the debt could be going to savings instead.
Credit ratings can take time to be rebuilt, but this boat anchor could hold you back for a lot longer (perhaps indefinitely).
Talk to someone in the business and find out what your options are. Better to have a clear understanding of what each path will mean for you.
Call the credit counselling society, they are a non profit and can give you extremely valuable advice.
>’m considering asking them to refinance and lend me the money so I can pay off the debts, and then just pay them monthly an amount that will obviously be much less than what is currently owed. Does this make sense?
So you want to ruin your parents retirement, psychological and financial safety because of your sense of entitlement, bad decisions and complete financial irresponsibility? No, this doesn’t make sense. Leave them alone, stop being a leech.
Talk to a licensed insolvency trustee, and think about a consumer proposal. This is the only option, even if you do get a better job and so does your spouse. $90k is no joke.
>I will need to either go bankrupt or consumer proposal, which will mess up my credit rating for a long time.
This is like worrying about a stone in your shoe when your house is on fire. Youre screwed financially, and will be for a while, and that mass of debt should be much more your worry rather than your credit rating, which wont matter since you wont get credit for anything anyway.
Go bankrupt. I can’t believe you would fathom doing this to your parents. Unbelievable.