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AIBU?

Aibu regarding sisters finances?

41 replies

CactusJelly00 · 22/10/2017 08:01

She works part time (can't increase hours) and has just split up with her OH. I know this is very stressful for her - I get it. I've been there myself.

I've been trying to help her, from another country away (I emigrated) sort her shit out. She's in the UK. Will get maintanence/small amount of tax credits and child benefit. We've worked out that after rent after school club (for her child) and her other essential expenses (but not food) she'll be left with circa £175 per week. Which is obviously more than some people have!
However, her issue is that she has debts. The repayments are £150 per week. But she won't entertain going to a financial help service ie, stepchange, nor negotiating a lower repayment until her circumstances change. The reason?
She was hoping to buy a house in 2yrs time and is worried she won't get a mortgage.

My bread and butter is financial services. I know full well she hasn't a chance at a mortgage right now or in 2yrs time. Imo she needs to get solid financial advice from the likes of stepchange or find another way to negotiate the payments down. I've even offered my help in writing a letter/email and doing it herself if she feels too ashamed to go to stepchange. But she won't do it as she wants to repair her credit. But she can't live like this,

One week of her ex not paying maintenance (of 25 a week) and she can't feed herself or her child. An unexpected expense and she can't feed herself or her child. Or she will default which will further hurt her credit anyway!

What she needs to do, in my personal and professional opinion is sort out getting the repayments down, clear off the debts then get a small loan or credit card and pay it off in full at the scheduled times (or each month in the case of a credit card) possibly even a dedicated credit builder card. But that's further down the road.

I also don't know how she proposes to save for a mortgage with £25 a week left to feed herself and her son.

Aibu?
She's asked for my help with this yet is ignoring everything I say on the subject because I can't magic up thousands of pounds and fix her credit report overnight.

OP posts:
InvisibleKittenAttack · 22/10/2017 08:34

You are right, but you can't make her see it. She's an adult and you've given her the info.

It could well be that right now, she can just about cope emotionally with giving up on the idea of living with her exp, raising their child together and growing old together. Giving up on the other future plan of buying a home in 2 years is too much to face right now.

Her hopes for the future have been destroyed, it will take some time to process and I can easily see why she's still focusing just on survival for now, but not making big life decisions (which giving up on buying in 2 years would be).

You are focussing on the practical side, you aren't focussing on the emotional impact of giving up all future plans.

Give her time, she doesn't need to stop the loan payments this week.

mygorgeousmilo · 22/10/2017 08:37

Well, you’re absolutely right, but she’s not listening. You can’t force her. Who are the debts with?

KimmySchmidt1 · 22/10/2017 08:40

She may be ashamed of her lack of finances compared to you. Of course you are giving her good advice but can you maybe co-opt a parent to persuade her? Or seen you can or she can speak to the banks about renegotiating the loan replayments so she doesn't have to go to stepchnage? Be persistent with them and ask to speak to their vulnerable customers service - they are getting better at this sort of thing.

CactusJelly00 · 22/10/2017 08:46

She has lots of debts everywhere, ranging from storecards and catalogues to a personal loan and credit cards.
They split up a fortnight ago, but he's only just moved out. It's still raw though, I guess.

I'm trying to be there for her emotionally but it's really hard when she asks for my practical help and then tells me no, but still expects me to be able to come up with a hundred other options for her. We've never been too close either, nor learned on each other emotionally. We were very different and at very different stages growing up, we're in our respective 30s and 40s now but the age gap (11yrs) was very difficult when we were younger as obviously we weren't ever into the same things, then she moved out at 17 and since it's just been pleasantries every few months. So I'm not sure what emotional guidance to give her when, while I love her I don't know her that well. I'm happy to help with the practical stuff though.
I've tried and now I'm at the point where I don't want to offer further help because it seems that unless it enables her to buy a house, have perfect credit and reduce the payments all in a year or two she's just not interested in listening. Gah

OP posts:
CactusJelly00 · 22/10/2017 08:48

Have asked her if she wants me to speak to her creditors (or have me help her do it) that has been refused also.

OP posts:
Papafran · 22/10/2017 08:50

Can you tell her to go and see a mortgage adviser so that they can tell it to her straight rather than it coming from you? £150 repayments a week is nearly £650 a month, so that must be a big debt.

HulaMelody · 22/10/2017 08:52

Does she maybe have more than she has disclosed to you, hence the reluctance to take you up on the offer to talk to creditors?
Or it is maybe too raw still...but regardless she’s in a very vulnerable position and she needs to swallow pride.

CactusJelly00 · 22/10/2017 08:54

It's not a single debt rather lots of little debts each week. The highest is £50pw the smallest is £12pw but there's some in varying amounts in between. It adds up to £150/week or 600 a month, though.
But yes she's in a fair whack of debt.
I'll try that tactic, might help her to hear it from an outsider.

OP posts:
CactusJelly00 · 22/10/2017 08:57

It's possible that she's hiding something, i'd like to think she wouldn't after going to the trouble of asking for my help but I suppose it's a possibility.

OP posts:
cheesypastatonight · 22/10/2017 08:58

You can't force someone to accept help. She knows the facts, if she wants to starve....

Petalflowers · 22/10/2017 09:08

You are giving the best advice you can. She needs to lump it all together on a balance transfer with free interest (maybe initial fee) and pay it off gradually. She will saves lots in interest.

Do you know the website monetsavingexpert.co.uk, set up by Martyn Lewis. They have lots of practical information, for people in your sister','s situation, written in everyday English. Ie. Not too many jargons, complicated financial speak etc.

If she is a spender, and unwilling to sort out her finances, she won't have the mindset to save anyway.

Petalflowers · 22/10/2017 09:08

You are giving the best advice you can. She needs to lump it all together on a balance transfer with free interest (maybe initial fee) and pay it off gradually. She will saves lots in interest.

Do you know the website monetsavingexpert.co.uk, set up by Martyn Lewis. They have lots of practical information, for people in your sister','s situation, written in everyday English. Ie. Not too many jargons, complicated financial speak etc.

If she is a spender, and unwilling to sort out her finances, she won't have the mindset to save anyway.

florarose11 · 22/10/2017 09:11

I'm not sure that you are right, as it happens.

Entering a programme of debt management such as Stepchange does significantly impact on your credit and as such I can understand why she is wary. Stepchange also can't help in every eventuality.

Ingurr · 22/10/2017 09:20

Are the debts all hers or are some shared with her OH. ? It's a lot of debt repayment each week. You are giving her good advice, it's a shame that she won't take it.

Plsadvise · 22/10/2017 09:22

If you work in finance you've probably already thought of this but have you tried suggesting moving the largest/most expensive debts onto a 0% deal with minimum repayments if she can find one? And trying to use the 6 months grace to throw everything she can at the other ones left to pay them in full rather than servicing them monthly?
It might not be as cost effective as consolidating but would leave her the option of having a bit more free money each month after the 6 months are up, and psychologically it feels amazing to clear a storecard and cut it up.
Whilst its not ideal she could probably live on that budget for 6 months, and deal with being short if things come up for that length of time, especially if she is doing some other things to cut costs, selling unneeded stuff etc to get a bit of extra income too.

CactusJelly00 · 22/10/2017 09:37

Her credit rating is too awful for them to consider her - she can't get a 0% card (specifically one that'll cover even the most expensive debts, interest wise). That was my first suggestion.

Entering into an arrangement or getting help from stepchange will harm her credit rating significantly less than the defaults she'll likely incur and based on the fact she'll be so financially strained she won't be in a position to put down even a minimum deposit anytime soon.

Based on her income and expenditure she is eligible for multiple debt management schemes (via stepchange or another financial institution). She just won't take it.

OP posts:
MyBrilliantDisguise · 22/10/2017 09:37

Why are the payments per week and not per month?

Anecdoche · 22/10/2017 09:38

This reply has been deleted

Message withdrawn at poster's request.

CactusJelly00 · 22/10/2017 09:38

All of the debts are hers - they are both in their own financial messes but I'm not so concerned about him, obviously.

OP posts:
KitKat1985 · 22/10/2017 09:38

Well you're right, but you can't make her see that you are right. She's asked for advice, and you've given her advice. Whether she chooses to follow that advice now is up to her.

CactusJelly00 · 22/10/2017 09:40

I presume she opted for weekly payment because she is paid weekly.

OP posts:
NotSuchASmugMarriedNow1 · 22/10/2017 09:40

How old is she? If you look at certain threads here you'll see that about 90% of homeowners purchase in their twenties

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Mummyoflittledragon · 22/10/2017 09:41

That sounds very stressful for her. And frustrating for you. Perhaps she will be more willing to listen when the shock of her situation has calmed down.

Papafran · 22/10/2017 09:44

If you look at certain threads here you'll see that about 90% of homeowners purchase in their twenties

Do you mean that that's the impression that is given on here? Because it's not true. The average first time buyer is 30, 32 in London, so it can't be that 90% buy in their 20s. Age is probably not her problem, poor credit is.

LIZS · 22/10/2017 09:47

I wonder if she is too embarrassed to tell you the full extent of it, which she would need to to accept help. Frankly a mortgage is the least of her problems. Is she actually paying debt back or just interest. Are the debts and interest frozen or is she still spending? Could she work a second job? How old is dc, will they get a free hot meal at school or if younger free childcare hours? If he moves out the council tax bill will reduce if she notifies council which may help a little.

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