MS and depression - debt getting bigger

[alwaysskint]

I wonder if someone can help point me in the right direction.

My cousin has MS, and on top of this, has been struggling with depression for many years. My aunt has recently moved in as my cousin's mental well being has deteriorated to such an extent that she is now suicidal

Long story short, she was signed off sick many years ago with the MS, and receives a pension, her home was also paid off.
We're not sure how she's managed to get all these credit cards (- that's another issue), but due to the MS and her depression, she's been having trouble sleeping, ordering things off shopping channels, paying for it on a credit card, getting more depressed, not sleeping, and so the cycle starts again.

The mental health team have suggested that my aunt gain power of attorney due to my cousins mental health

1. What are the implications of POA for my aunt with regards to her daughters debts
2. What's the best action to take regarding the debts, and what degree of success should she expect (I'm thinking they could get the interest stopped due to mental health?)
3. Has anyone got any advice/guidance to offer

Thanks in advance
My aunt is approaching 70 and this is starting to make her health suffer now as everyone she speaks to gives her conflicting advice - one said cousin should take out a secured loan on the property to pay off the debts - problem with that is aunt doesn't know how she managed to get all the credit cards she's already got so how could she stop her getting more. If cousin pays off the cards, she'll view it as more to spend in the early hours.
Chances are the loan payments would get missed/forgotten about and her daughter and grandson would lose their home!
If she had POA would this be an option as aunt would make sure payments were made.
Another said cousin should get an IVA - I didn't think she could do that if she owns her home outright?

[pompeyfaith]

Re: MS and depression - debt getting bigger

Is you Cousin under a physiatrist? Reason I ask is because if she is she can get help via MALG The Money Advice Liason Group who deal with debt problems and mental health.

http://www.malg.org.uk/

http://www.malg.org.uk/dmhdocuments/...20creditor.pdf

[SXGuy]

Re: MS and depression - debt getting bigger

Im sure there are some sucess stories of debts being written off due to mental health issues, and im certain there are guidance in place to deal with such matters, but ultimately, the cycle will have to stop.

Unenforceablity may be an option, as not only would it get rid of current debts, it would make it impossible to obtain credit for 6 years, so in a sense it would kill two birds with one stone.

[alwaysskint]

Re: MS and depression - debt getting bigger

Is you Cousin under a physiatrist? Reason I ask is because if she is she can get help via MALG The Money Advice Liason Group who deal with debt problems and mental health.

Thanks for those links Pompeyfaith, much appreciated.

I believe she has an appointment next week with the psychiatrist, due to this latest episode with depression (suicide - not sure if it's been attempted or not)



SXGuy: Thanks also for your reply
I'm not sure my aunt has the strength to fight and go down that road, with everything else going on, although I see your logic :-)
To be honest, I agree, the cycle has to stop, and my cousin was helped previously with money management guidance a few years ago I believe, CAB wrote to all creditors and arranged payment schedules for her to follow.
She was however, left to her own devices at that time, which obviously didn't work. She has been able to obtain further credit somehow, and kept the information away from her mother.

The difference now is the severity of my cousins mental state, and the fact that POA has been strongly suggested.
My aunt is very 'old school' (and I don't mean that disrespectfully - just that if you want something you save for it). She's currently getting into a right old state with every postal delivery as more and more debt letters are arriving.
I think that's the only reason we've found out about what's going on - she's horrified that my cousin not only didn't stick to the plan from last time, but is in even more debt than before (and she's upset with herself for not realising it was still going on all this time)

Would obtaining my cousins credit report be of any benefit?
Would non payment of all non essentials for a couple of months be enough to damage her credit rating enough to prevent her getting more credit, by which time POA could be in place and my aunt would make arrangements to pay?
How would uneforceability work when the credit has been obtained recently? (more than likely online applications as she rarely goes out)

[SXGuy]

Re: MS and depression - debt getting bigger

If they are recent debts, then unenforceablity is a risky option. perhaps not the best one in hindsight.

When you say make arrangements to pay once you have POA. Do you mean offering creditors an affordable amount each month, or do you mean continuing to pay the min amount required in the credit card agreement?

If you mean an arrangement where you repay the debts at less than the agreed amount each month, then her credit file will eventually have defaults, which will put a stop to any future credit for 6 years.

So the time between not paying anything and obtaining POA is not really a concern, either situation would trigger the same results.

If you meant that you wish to continue to repay all the debts at the agreed monthly amount each month, then i doubt it would affect her credit rating that much.

[alwaysskint]

Re: MS and depression - debt getting bigger

Too risky for my aunt I think
I will explain the difference between paying the min monthly, and making an arrangement to pay (default), as I believe the idea is to prevent her getting into more debt, so being unable to get more credit is the preferred option.

Thanks x

[cymruambyth]

Re: MS and depression - debt getting bigger

Do not take out a secured loan. The property could be put at risk if the debt cycle resumes.

have you contacted MIND as they should have guidance for this situation.

[Undercover Elsa]

Re: MS and depression - debt getting bigger

Sorry to read about this, Alwaysskint. What a sad situation

First of all, for your Aunt to get Power of Attorney or Lasting Power of Attorney, your cousin would need to have the mental capacity to understand what she was signing and agreeable to your Aunt managing her affairs. It's a reasonably simple process which can be done online. I've attached a leaflet which may help.
Mental Capacity is defined here: http://www.mentalhealth.org.uk/help-...city-act-2005/
If she's already gone beyond that stage, then it's a much more complicated process involving applying to the Court of Protection to act as a Deputy.
More about POA and COP in this leaflet>

AgeUKIG21_Powers_of_attorney_inf.pdf
As you can see it's better to do it sooner rather than later if your cousin's condition is deteriorating.
With Power of Attorney your Aunt wouldn't be liable for her daughter's debt (unless of course she had guaranteed or cosigned any).

As for actually dealing with the debts, in all honesty the fastest way to get interest stopped and Credit File Default markers is to stop paying. Once that's achieved then she could write to all the creditors informing them of the circumstances, utilising the MALG guidelines, and asking for a write off or token payments. If she's not happy with doing that then it's a case of going straight in with letters to creditors explaining circumstances, enclosing an Income and Expenditure sheet and medical evidence, asking them to supply a MALG form for the Mental Health team to complete.

Once the credit cards were defaulted or the creditors aware of the circumstances your cousin wouldn't be able to use them to buy online.
With POA your aunt could ask the bank to issue a new debit card for her current account and keep it herself. If money's available maybe take out a prepaid credit card with an affordable fixed amount paid in each month so your cousin can still buy something to satisfy her cravings, but within preset limits. The last thing your Aunt would want to do is precipitate a further slide into depression, so that could be a workable compromise.

I do hope your Aunt is strong enough to deal with this, it's a bizarre situation when your Aunt should be slowing down and enjoying her retirement - looked after by her daughter -instead of the other way round.

Elsa x

[SXGuy]

Re: MS and depression - debt getting bigger

just a point to also mention, theres nothing stopping your aunt, writing to her creditors, if she wished, but use a digital signature and make it addressed from your cousin.

I do this for my mother all the time. She knows the content of the letters and agrees to them, i write on her behalf. No POA needed.

[alwaysskint]

Re: MS and depression - debt getting bigger

It is indeed a bizarre situation Elsa. My cousin's MS and depression hasn't made my aunt's life particularly easy the last few years, and more detailed information has started to come out over the weekend I will pass the information along, thank you.

I have already stressed that under no circumstances should there be a loan secured on the property to clear the debts. There is a minor involved, so keeping the home safe is a priority.

Thanks SXGuy, the problem with not obtaining POA is that it could backfire later, so POA is the preferred route - all legal and above board, with the backing of the mental health team (it was them that suggested it) I will however point out that any communication by my aunt should be signed digitally, and explain the reasons for this, thank you.

Thanks to everyone for their input x

[Undercover Elsa]

Re: MS and depression - debt getting bigger

Hope it works out AS...let us know how they get on x

[alwaysskint]

Re: MS and depression - debt getting bigger

Thanks, so do I... She's been admitted to hospital today

[Pixie]

Re: MS and depression - debt getting bigger

Sorry to hear that AS

[Undercover Elsa]

Re: MS and depression - debt getting bigger

Hope she's OK AS Is it for the MS or depression?

Would be a good time for your Aunt to sort a few things out though, while she's being cared for by someone else.

[alwaysskint]

Re: MS and depression - debt getting bigger

Apologies for not replying earlier, been a bit hectic.
After being admitted to hospital, due to the MS, my cousins condition rapidly deteriorated to the point where she was in a vegetative state. All sorts of tests were being done, and one doctor let slip they were finally testing for CJD!
Thankfully, this has come back negative, and she has started responding to the medication they are now giving her. It's been a harrowing few weeks, and everything else has been put on the back burner until her health has stabilised.

Fingers crossed that'll be soon x