Writing off unsecured debt due to mental illness?

[meerkatsmimm]

Hello Folks,

 

Apologies I have been offline for a while, things have been difficult with mum due to some personal issues and while continuing to deal with her affairs at present, we would appreciate some advice.

 

The situation is mum owes substantial amounts in unsecured credit card debt and has been paying up until very recently when she simply ran out of savings. Her income since medically retired from work in the late 90's was made up solely of benefits and any money she has had as savings came from the sale of her last home. Truthfully, this dwindled to nothing simply paying the CC bills each month.

 

She was diagnosed with PTSD at the time of retirement and her doctor recently stated that he would support the fact that she will never return to work. This was after us explaining the situation she faces. He is also very willing to support us in anyway he can, with letters to the creditors etc.

 

In the last month a major incident happened in our personal lives and it has sent mum spiralling. Her doctor has prescribed a big step up in her meds to try to calm her down as she is just not able to cope with this other issue. We have been keeping as much as possible from her surrounding her debts and have her written authorisation to allow us to deal with things on her behalf.

 

As things stand, we wrote to each of her creditors initially, explaining her finanical circumstances and medical conditions, and included her doctors name and address, inviting them to confirm things by making contact with him directly. As part of this letter, we asked them to consider writing the debts off, given her previous good payment history (for what that was worth) and the fact that she is never likely to return to work. Her only asset is her home, which is in negative equity and likely to remain so for a very long time.

 

As a response they have all sent a standard letter, none acknowledging the one sent to them, other than to say they are sorry to hear she is experiencing financial difficulty.

 

EGG have stated they need a payment plan set up with a formal agency such as CCCS.

 

BC have said the same, giving two weeks from their letter before they will ask Mercers to issue a Default Notice.

 

The CCCS, even though she has £135 surplus per month available (but only because she is including her DLA in the calculations, which as I understand she cant be forced to do - although we suggested she should if it helps get a DMP set up), cannot help - typically suggested bankrupcy or negotiating with creditors directly.

 

Trying to get CAB involved, but getting an appointment with a money advisor isnt easy as many of you know.

 

Have offered EGG a pro-rata amount of this figure, putting a condition in the offer that they freeze and future interest and charges. Made it clear to them that at present we have no other assistance from a formal agency so its take it from us, or take £1 per month and we will remove her DLA from her calculations.

 

Their reply was a letter (which I am hoping was a cross-over letter, although was 7 days from the previous) stating that she is in serious arrears and no mention of our offer.

 

BC & the others have been sent no offers, because at this stage I dont know how best to proceed.

 

We read on the CAB website that with her intervention, it may be possible to have unsecured debt written off, if the mental illness is so bad that the client is unlikely to ever clear the debt due to being unable to return to work etc.

 

Can anyone offer examples when this has been possible and also how they went about dealing with the situation?

 

As it stands, everyone has been CCA'd & SAR'd & CPR letter 1'd on her behalf.

 

Only 'agreement' has been EGG, and it was the 'approved limit' job, with a very odd signature date and was one of the 2007 Terminated accounts. We wrote to EGG asking for an explanation of both and after almost 3 months, their response to the complaint was that they have been unable to respond! and we can now take things to the FOS!

 

BC have sent nothing - no cca, just some recent statements. In fact, the letter with the SAR states that they have nothing more than what they have sent. However, this was a previous Monument card, so could there be more that they might be able to access?

 

Had application forms back from her other creditors, without the prescribed terms.

 

Two of her other creditors had her listed as 'retired' at application and on benefits as her only source of income. Payplan have stated that this is irresponsible lending and the FOS/OFT (not sure which) could intervene in these situations and get the debt written off.

 

With her other creditors it isnt so clear what she said at application stage - could have been anything and as her credit history was always good, she got the credit with no other searches to confirm her standing. She got sent flyers for cards and just applied for them, with little understanding of what she letting herself in for. We actually think she has some form of Bi-polar disorder (although it is getting confused with the depression she is suffering, and it is something we need to discuss with her GP as its just an assumption) although it would explain the spending for no rhyme or reason.

 

Dont get me wrong, she didnt live the highlife, the money went on very little. In saying all of that, they have had their pound of flesh out of her she has most certainly paid back what she spent - with interest!

 

Our concern is that if we state she was retired at the time of application (and without seeing her applications from two of her creditors to know what she said), that they might have a different story and treat her as a fraudulant client, which is just not the case.

 

But you can understand our fear I am sure.

 

Bottomline, she is not well, not likely to be well again anytime in the future and relies solely on benefits for her income. Its mental illness, so she cant understand or remember correctly what she said yesterday, never mind years ago. She also is very scared because she thinks they will take her home, which we cannot reassure her about as we simply dont know either (they shouldnt, but will they try?)

 

The major incident that happened this month has set her back no end and we can provide evidence of this to her creditors if need be as it was in the public eye.

 

Dont even start me on our own situation - who knows is my best answer at present - she is our top priority.

 

Any advice or suggestions would be so much appreciated as always.

 

Meerkat xx

[meerkatsmimm]

Thanks Noomill,

 

Ill have a read at that now, thanks for stopping by.

 

meerkat x

[meerkatsmimm]

Thanks Pinky,

 

Her doctor has not mentioned this as yet, I guess we should suggest it to him.

 

I read some of the online notes for the mental health professionals and debt, the sad thing is that they dont seem to be able to do much other than get in touch with CAB/CCCS on her behalf. But I agree something in wirting from them looks more official than our words.

 

meerkat x

 

Thank u noomill x

[meerkatsmimm]

Thank you Joemay, Crapstone and Surprise,

 

Your responses and thoughts are much appreciated.

 

In terms of bankrupcy, it isnt an option. If her home would be at all threatened, we cant really consider it.

 

Having thought originally about a dmp situation, and not had our initial attempts to set this up work, we are in two minds, simply because so many of the creditors have no CCA or an unenforceable one. In fact, one one creditor had anything like an enforceable document, and they have just paid cleared that account with PPi re-claim (another fight we have atm!).

 

In terms of the fraud, Crapstone I agree - what can they gain? But like we see everyday on CAG, creditors are unlawful and just dont care, so our fear is that they try to cause mum more harm, simply by going through the motions of threats of court action or criminal action. Would a doctors letter explaining that she was ill at the time (and also not receiving any treatment at the time of all these applications) in this instance be enough to knock back such actions?

 

One of her creditors especially has been silly about their lending, and I believe we have them in the right place to be able to get them to write the debt off. I suspect their lack of response to my letters shows that they know this also.

 

I guess with so many things we do, its trying to draw things to a conclusion to our satisfaction. So many of these things (if the creditors could get their way) would continue and follow us to the end of our days. Mum just isnt in a place to cope with things much further.

 

She has talked about suicide in the past, but not recently. We had discussed mentioning this in the correspondance with her creditors but she got so fearful that she might get locked up in a psychiatric unit for the rest of her days that she begged us not to.

 

Im glad to know others are dealing with similar situations and surviving, Thank God. And Thank God for CAG and all you good people here.

 

meerkat x

[meerkatsmimm]

Thanks Elsa and thank you again JoeMay,

 

The Guardian really helped out that chappy by the sounds of things, my only issue is that they would want a story out of it and mum has enough going on atm without that happening.

 

Having said that I will send them an e-mail, thanks for pointing the link out.

 

Joemay, I understand where you are coming from. I get scared for her because in the last year she started to shop in charity shops, buying bits and pieces and everything is hung in the wardrobe - she never wears it.

 

She tends to wear the same outfit for weeks and rarely thinks about showering. Its made more difficult because her own mother has altzimers (spelling!) and has fallen into the same trap of wearing something familiar for weeks and not bathing adequately. Mum thinks granny is ok, that she makes sure she is clean, but doesnt need a shower every day.

 

The problem is days turn into weeks.

 

Her flat is packed, floor to ceiling, with bits and pieces. Mostly secondhand, some from our old family home. She has just about enough space to get into her bed and sleep. The rest of the room is filled with junk.

 

Her bathroom is the same.

 

When we draw things to her attention and suggest we sort them, she goes off at the deep end with us, saying there is nothing wrong.

 

She has an old car that my hubby tries to keep clean for her when we see her. But it is pigging dirty inside and out and because she smokes there is ash everywhere.

 

I just feel sick for her. She was such a young woman when she was widowed in quite a violent way, and I know deep down she hoped for better at this time of her life.

 

And in the midst of all of that, she could run into someone she knows from years ago and say everything is just dandy, great feeling being a grandmother etc. Im sure up until recently she wasnt being very open with her doctor either, although I know that is now different.

 

So, hubby and me need to do what we can, and hopefully get these debts of hers blitzed and then start to work on her getting her life back together again.

 

Thanks everyone for your thoughts.

 

meerkat x

[meerkatsmimm]

Thank you Crapstone,

 

Such a late at night/early in the morning post, Ive been there myself!

 

CAB have got in touch so going to start with them. OFT put you straight through to Consumer Direct, who from past experience are not much help at all (felt like I was getting told off by a teacher when I started talking about my creditors non-compliance with CCA request!)

 

Agree that we should perhaps use our local MP and a veiled threat of the media aswell.

 

I assume when the write the debt off, they still get a tax break to the same value, so they are really at no loss?

 

Thanks again,

 

meerkat x

[meerkatsmimm]

Consumerline (OFT) dont think they can help, which was as we thought.

 

CAB in Northern Ireland no longer offer any advice over the phone, we have to go into a drop-in centre between 9-30 and 12-30 am and we will be seen if the debt advisor has time.

 

Is that correct?

 

I thought we had to make an appointment to see a money advisor, its pretty hit or miss depending on how busy they will be.

 

The guardian is the next move then!

 

meerkat x

[meerkatsmimm]

Thank you folks,

 

CAB tomorrow and see how we get on.

 

Deb T Bankrupcy just isnt an option and to be honest, having read articles like those posted by Elsa, I dont see why mum needs to be put through those hoops. They can and do write off debts, its just how we channel this to them. But thank you for your guidance.

 

Elsa, I posted on the other thread about what I thought of that document - shocking.

 

meerkat x

[meerkatsmimm]

Hey BBNB,

 

I agree, and its that point that leaves my mums home in doubt - its her own 'security' in her life, and she certainly never took out any secured debt, so the creditors arent entitled to it!

 

God bless those that do loose their homes, nightmare.

[meerkatsmimm]

Hi Folks,

 

Its been a long day so sorry for the late reply.

 

Hubby is on a 24 hour blood pressure monitor as his doctor believes he has high blood pressure.

 

Elsa - Thank you. Thats above an beyond the call of duty, but we will gladly accept any help you can offer. If you want to PM me with what you were thinking rather than posting up on the forum at this stage that would be great and I will work with you on that. Perhaps when we get a finished document together we could start a new thread for others to benefit from as you suggest?

 

I think that would be wonderful to put things together in a document that could be sent off, clearing stating mums case.

 

We have done letters as stated, but its a case of trying to be firm while at the same time trying not to p*** them off....

 

Thats not enough though and they do need to be put firmly in their place.

 

Crapstone/JoeMay - agree BR isnt the solution for mum, the creditors have had their pound of flesh off her, she shouldnt loose her home as well (even if its only a small possibility).

 

CAB tomorrow, waited for the 3 hours today and the amount of people who didnt get to see someone was crazy. Just so many people in the same boat as ourselves its frightening.

 

BBNB, Everyone has been CCA'd, SAR'd and CPR 1 31.16. Had two applications as a result (one with no prescribed terms and one with some prescribed terms but this has been cleared by PPI reclaim) and the only other document was the 'approved limit' agreement from EGG, with a funny date (4 years after mum applied for the card). BC sent nothing!

 

No response as yet from EGG to our pro-rata offer (nearly two weeks ago since it was offered) and BC gave us 14 days to get an acceptable DMP offer through from either CAB or CCCS, and then they will issue a DN through Mercers.

 

CCCS suggested BR - even with just over £120 per month available (although that was including mums DLA). CAB no further forward as yet.

 

BC timescales are impossible to keep to, they are such a joke. 6 months since our CCA request (myself and hubbies) they still havent been able to fulfill it, but yet we should be able to get a DMP set up in two weeks....

 

Nobody has had any payments for a couple of months.

 

We put all her accounts in dispute (the ones that we could) a few months ago, so it will be interesting to see what they believe they can do with these accounts.

 

But thank you all for this, its a great boost for us all to have this support.

 

meerkat xxxxx

[meerkatsmimm]

Hey Everyone,

 

Finally got speaking to CAB last minute on Friday, one of the managers took pity on our pleas for requests to speak with someone, having waited three days in a row to see someone and not getting anybody.

 

Firstly, the lady wasnt a money advisor, but she was able to tell us pretty much what they could tell us anyway - she just couldnt get involved anymore than information.

 

She believes that mum has a genuine case for trying to get the debts written off due to irresponsable lending. However, to start that ball rolling we have to see a money advisor.

 

Right away she stated that if we havent made any payments yet, then we shouldnt, we should stop all correspondance and ignore all letter and calls - then just let the accounts go statute barred in 6 years.

 

She also stated they were advising more and more people to do the same. It sounded a little flipant, but at the same time I can understand how this is good advice for many. The only caviat she put in was that if some of the debts were large, then some creditors might seek to take this to court to try for a charging order, but that in Northern Ireland, very few people are getting a forced sale of their homes.

 

I phoned back today to arrange to see a money advisor, only to be told by the same manager that we would need to call into the drop-in centre, wait to see an advisor again and then complete a raft of forms, then they will refer us to a money advisor after that point....

 

Is it really so difficult to get this basic help? God Bless those who are struggling without CAG on their own.

 

So because of our situation with mum, it looks like its going to have to be a money advisor close to our home she will need to be dealing with, I just dont know if they have different legislation in Northern Ireland than they would in England, so perhaps this will be a mistake?

 

That aside, im off to write my e-mail to the Guardian and see if they would be interested in getting involved with mums case.

 

She had her first letter from Mercers last week, together with what appears to be a compliant DN. Not good.

 

Hoping to get the Guardian onboard so that they next letter we send them has a bit more weight behind it.

 

Talk soon everyone,

 

meerkat x

[meerkatsmimm]

Yep, good old NI!

 

us folk have to stick together lol!

 

Well I penned a long 7 page e-mail to Rupert Jones, the author of that article that Elsa linked us to at the Guardian, so heres hoping for a positive reply.

 

A nice update with BC, Mercers and Scot Call both collecting on the same account and both collecting with two different names and two different numbers - ON THE SAME LETTER!!!

 

Maybe they are having to cut back abit on their stamps...

 

So thats BC, Mercers and Scot Call all on the one account. We havent even had that with ours, you talk about taking advantage of those who are most vunerable.

 

OFT - here we go, here we go, here we go!

 

and hopefully your shameful companies names in print in the Guardian soon, hopefully reading this Mr.DCAs...

 

meerkat x

[meerkatsmimm]

Hi Elsa,

 

I figured you were away somewhere!

 

Thats really good of you, it will be great to be able to focus mums creditors more, as they arent playing ball.

 

Ill speak with you soon.

 

Take care and thank you again,

 

meerkat x

[meerkatsmimm]

i've already tried responding 3 times....

 

Elsa - thank you so much for everything here so far - it looks like i'm in for an interesting read if i can get the internet to work...

 

having problems with my internet connection but i'll be around as much as i can.

 

thanks again elsa,

 

you're a star!

 

meerkat xx