Friend in really bad financial situation

**GFNancy** · 10-31-2008, 08:34 PM

A friend of mine is getting separated from her husband. Not her choice. Not her timing. He's been stringing her along that he wants to work on their marriage and then a few days ago he totally blindsided her by saying that he wants to get his own place within two weeks. She's talked him down a little bit, but it's still immediately, if not sooner.

They have already been hanging on by their fingernails with their finances. They were one of the people who chose to get a 2 year ARM and they've been barely scraping by for a year now.

So now her DH (guess what the D stands for) is basically leaving her holding the bag. He's not taking his income out of their accounts, but he is leaving everything in her lap to figure out.

They've got a lot of credit card debt and their minimum payments come hundreds of dollars a month. She mentioned at one point how much they pay in minimums at one point and I hope I misheard her because it was really high.

She really wants to keep the house. They owe more than it's worth at this point, but she doesn't want to put her kids through even more than what they're already going through. She's been thinking about looking into one of those credit counseling services. From what I've read here though, they are usually bad news.

Is there even one of these services that are trustworthy? Or would she be able to get a debt consolidation loan with such a bad financial situation? Any other options or advice that might help her keep her house?

She does know that most likely she's going to lose the house, but she wants to at least try to keep it.

Thanks,

Nancy

**Greebo** · 10-31-2008, 08:42 PM

Based on what you've given I'm sorry to tell you, but your friend is evading reality. Reality, however, won't let her hide for long.

If they struggled before separation, there is no way she can keep the house on her own.

She needs to brace herself for major, major changes. If she tries to keep what she can't afford, the misery for the children will be compounded multiple times. She needs to start working on a realistic plan.

**debmar** · 10-31-2008, 09:59 PM

Odds are once he gets his own place he will quit putting his money into 'their' account. If he does leave the money there, at some point he will accuse her of using some of his money for her expenses. I guess I sound bitter - don't mean to be just speaking from experience.

The only other thing is to tell her to get her own lawyer. I know it flies in the face of maybe getting back together, which is probably what she is thinking right now, but she needs to protect herself and her kids.

**Ilovesewing** · 11-01-2008, 12:08 AM

I would tell her to see a lawyer to make sure he pays his part in the mess. Once he moves out he may decide to 'keep' what he wants and let her deal with it. Grown men should not be able to walk away scot free from their families! Tell her to make sure she and her children are taken care of.

**ladykemma2** · 11-01-2008, 06:49 AM

if i could recommend that she sell the house, sell everything that isn't nailed down, get divorced, and get the H out of california. Houston has lots of jobs and cheap, beautiful housing. she can make it on her own here.

**FrugalMomof3** · 11-01-2008, 07:49 AM

I think she needs to get an attorney ASAP. Once he moves out he will either A) no longer put his money in their account or B) accuse her of using his money

First off they are still married, he has to support the children and pay spousal support. I sure hope at this point in time he makes a decent wage, make him pay what he owes, sell the house, move out of CA (expensive to live in) and live somewhere she will be happy, can afford and her kids will like as well.

**larabelle** · 11-01-2008, 07:58 AM

Here is the sugar
1.)I agree that she should get a lawyer to be sure her husband pays what he owes (child support, spousal support).
2.) She should sit down and have a long heart to heart talk with the children related to the many changes which will come.
3.) She should polish her resume and start looking for a job out of California.

Here is the vinegar:
I agree that reality is about to slap her in the face.
1.) She should sell the house ASAP
2.) I agree that she should sell everything and I mean everything that she possibly can.
3.) She should move out of California much to expensive to live there. Look for somewhere cheap the midwest is alot cheaper than California.
4.) She should make and adhere to a strict budget (Yes! that may mean lots of beans and rice and no more McDonalds)

**rainbowgc** · 11-01-2008, 10:35 AM

Sell everything (buying used later) Move, catch the attitude of kicking his a$$ to the curb. If they can't make it $ together, how are they going to make it apart with the expenses of 2 places DUH. Take all the $ out of the account before he does - she has the kids and needs to look out for their welfare. Get to legal aid and file for child support ASAP.

**Michelle68** · 11-01-2008, 11:34 AM

Originally Posted by GFNancy

Is there even one of these services that are trustworthy?

As for this question, if there is a Consumer Credit Counseling Services in her area, they are a non-profit and one of the only debt services that are really on the up and up as far as I know.

Unfortunately, I have to agree with everyone else, though. From what you have said, it looks like her best option would really be to sell the house and move somewhere less expensive. Good luck to your friend.

**HappyMama** · 11-01-2008, 12:29 PM

Nancy,

You have gotten some terrific advice that I agree with so just wanted to give you hugs and kudos for being such a great friend. Your friend is really going to need the emotional support, clarity ( as these tough financial decisions are going to need to be made fast and smart) and good solid attorney and financial advice.

California is "Community Property" state. Community property is defined as all property and debt that was acquired from the date of marriage until the marital cut-off date. The community assets will be split equally by the Superior Court if the spouses are unable to reach an agreement. She needs an attorney right away and from the sounds of it if he is in an emotional state right now

nicest way I could put it...lol the joint account might be drained faster then she can say jack rabbit. Anyone on a joint account can withdraw it all. Hugs and Blessings my friend!

**HappyMama** · 11-01-2008, 12:31 PM

Originally Posted by Greebo

Based on what you've given I'm sorry to tell you, but your friend is evading reality. Reality, however, won't let her hide for long.

If they struggled before separation, there is no way she can keep the house on her own.

She needs to brace herself for major, major changes. If she tries to keep what she can't afford, the misery for the children will be compounded multiple times. She needs to start working on a realistic plan.

Very true Greebo !! A good solid thoughtout plan is going to be very important right now.

**GFNancy** · 11-03-2008, 10:27 PM

Thanks guys. You're all thinking down the same road I am. I just wanted to make sure I hadn't missed anything.

I have no idea what she's going to end up doing. I'm trying to push her toward at least talking to a lawyer to file for legal separation if nothing else but to get some legal protection for the money.

She's still evading reality, as Greebo put it. Not just on a financial level either. Her DH is dragging her through all sorts of stuff.

No surprise to anyone here I'm sure, but over the weekend he took a few hundred dollars out of their account. Didn't wipe it out, but now there are bills she can't pay so he might as well have because now she's going to have to call the mortgage company because she can only pay half the mortgage. What a %&*$&#.

I just wish she would get mad. I'm sure that will come eventually, but it's just so hard to see her get walked all over like this. I'm trying to find the balance between being her friend and helping her vs. just being someone else trying to tell her what to do.

Nancy

**fuzzybunny** · 11-04-2008, 04:06 PM

Originally Posted by GFNancy

No surprise to anyone here I'm sure, but over the weekend he took a few hundred dollars out of their account. Didn't wipe it out, but now there are bills she can't pay so he might as well have because now she's going to have to call the mortgage company because she can only pay half the mortgage. What a %&*$&#.

If he is already refusing to pay his share of the mortgage on the house that is in both their names then she is surely going to loose the house. If I were her I would stop paying all the non-essentials at this point. If he doesn't deem the house important enoug to pay for then she shouldn't shoulder it by herself, same for the credit cards

It takes a long time to go through a foreclosure so the housing is secure for quite sometime. Yes, her credit rating is going to take a beating but it will anyway before this is done. She ought to just worry about lights, food, heat and take the extra to a see a lawyer. He's taking care of himself first and she needs to do the same. She needs to learn about her options not just for separation but also bankruptcy. She may not want it but it sounds like he's going to drag her there one way or the other. She needs to make sure she doesn't get stuck footing the entire bill.

I know Dave Ramsey has talked about this several times... I wish I could remember more of what he said but the general gist is this: Women generally get the house and generally the house drives them into poverty. It is better for a woman to refuse the house and force its sale in the divorce. I remeber him saying that when a mortgage is in both parties names the only way to gain sole controll is to get the mortgage refinanced into one person's name. If she doesn't qualify for financing on her own then she will never really "get" the house, she might have legal posession but the paperwork remains in both their names because she doesn't qualify for financing on her own.

If she fails to keep up the payments then she will drag his credit into the muck and they will come after him, making the separation even uglier or on the flip side, he could yank the equity and she would still be responsible for the additional debt he inccurs.

She really needs to get to a lawyer ASAP. To quote Dave one more time, her husband has changed their relationship into a business transaction and she needs to act like that from here on out... as much as it stinks.

**Lorelei** · 11-04-2008, 04:35 PM

Haven't seen anyone mention this yet, but she needs to close all the joint accounts. For both their sakes, having a joint account is a mistake at this point. He should be paying child support & for various bills, but he can make those payments either by check or depositing to her sole account. Leaving any joint accounts is just a recipe for disaster, even if there is a chance they could get back together later.