GardenArtist, this is one of the largest local banks in Hawaii. Glad my accounts are not with them. JoAnn29, I put a freeze on 3 of her CCs, but, the 4th I couldn't because I could not get the PIN from her. She keeps telling me, "It's MY money, I can do what I want." OK. Wife and I also pay off our charges every month. Thanks everyone for giving me input. Mom and I had it out over the phone again today. Nothing new. I keep finding out about her finances from other sources. She just wants to have things HER WAY.
It may be an open credit line. We were offered this but didn't take it. It works like this...She may have taken it out to pay down her credit cards. So, as she pays on the 10k, let's say 2K, She now has 2k in credit she can use. It is ongoing. If a consolidated loan the bank usually sits down and writes the checks to each credit card or debt holder. It doesn't go into ur account. You need to sit down with the financial officer and ask for an explanation. Hopefully, someone has POA. I would freeze her credit cards. Ask the bank if they have or know of a credit agency who can work with you to bring down the credit card mats owed. She probably has finance charges and maybe late charges that can be lowered.
Now, as to who owes them upon death, the estate. If Mom has no money, the money owed will have to be written off by the companies. POAs and families are not responsible for the debt.
Be aware, that paying the minimum on Moms charges does not even touch the principle. You need to pay more to bring it down and stop using the cards. I pay my charges off every month. One month I was late 1 day. Finance charges are calculated before your payment is applied so I was charged. Then I was charged a late payment of $35. I called and told them this was the first time this has happened in the years I had the card. They agreed and dropped the finance charges but left the late charge. So you can see where credit cards can get out of hand. I bet she is paying the highest finance rate.
Not just shamed--examined!! What bank thinks they are going to get back the loan when she's already 20K in debt and has no assets? This just sounds super fishy to me. She's obviously not going to pay this back before she dies---not on SS income alone.
Aloha, you might want to check with your state, particularly the attorney general's office, to see if it has any role in examining elder abuse.
With a $20K credit card balance, I don't think any bank would want to extend a $10K loan. That certainly isn't following good lending guidelines. Is this a national bank, or a local one? I can't remember for sure which governmental agency regulates national banks, nor am I sure that in the current D.C. political environment that there would be support for pursuing elder financial abuse.
Midkid58 and GardenArtist, thanks for your comments. She doesn't own ANYTHING. No house, jewelry, annuities, etc. Only a 2006 Honda (he drives, she doesn't), and $6,000 in checking account, which she deposited the loan into. 4 credit cards 9in her name only) with $20,000+ balance. Now, this $10,000 loan. I'll ask to look at the loan agreement when I go over to talk to them. I'm pretty sure he's not skimming anything, but, since I'm not there...
Midkid, you raised a good point about the estate's liability. I hadn't thought of that.
Aloha, will her brother give you a copy of the loan agreements? I wonder if she really signed or if he signed on her behalf as proxy. If you can get a copy of the loan documents, look for any clauses that allow cancellation after a certain period of time. Some states have these mandatory options for borrowers who change their mind and want to rescind the contracts.
IF she was in her sound mind and IF she really took this money, at the time of her death (assuming the debt is not totally repaid by then) her estate will have to pay.
IS her brother totally on the up and up? Just that you threw that in there, last moment. Could he be financially gaining from her loan? Just a ??
Unfortunately, this sounds like elder exploitation to me, especially if she doesn't have the resources for repayment.
Lenders can only seek recourse from the signer, the borrower, UNLESS someone guaranteed the loan. If so, there would likely be a guaranty agreement, but if you didn't sign and you don't know of anyone else in your family who might have, there's probably not a guaranty. In my experience, these are primarily for business loans.
No, I do not have any paperwork. I went to the local bank where she has an account to get information about her joint checking account with her brother who writes the checks to pay her bills. I just wanted information about what happens to the account after she passes. The bank then told me she now has that loan which was approved in December 2017 as part of like a "consolidation loan" promotion to pay of CC, etc. So, the bank employee told me she was "pre-approved." No, she does not have any property or investments, etc. As far as I knew she only had the checking account which had only a couple thousand dollars. I was in for a shock when I heard about the loan. Yes, she is competent enough to sign. I guess the bank just wanted her money, so, any age doesn't matter. Can the bank go after her family to pay unpaid balance? This is all new to me and I'm pulling hairs. Thanks for any response, tips, and suggestions. FYI, she lives with her 75-year-old brother and he handles her finances.
Definitely take a look at the paperwork. If the loan is unsecured, there may be an insurance element built into the monthly payments. I took an unsecured bank loan to buy a car but the car was too old to be used as collateral. The bank is charging me monthly for insurance to cover the loan in the event I should die or otherwise become unable to pay. There may be that provision in your mother's loan too. Certainly at 94, it would be crazy not to.
Do you have the paperwork? The signer is the responsible party but did she put up a house or other item as collateral? That could change the response! AND who gives loans to a 94 year old person? Was she competent to sign the papers??
JoAnn29, I put a freeze on 3 of her CCs, but, the 4th I couldn't because I could not get the PIN from her. She keeps telling me, "It's MY money, I can do what I want." OK. Wife and I also pay off our charges every month.
Thanks everyone for giving me input. Mom and I had it out over the phone again today. Nothing new. I keep finding out about her finances from other sources. She just wants to have things HER WAY.
Now, as to who owes them upon death, the estate. If Mom has no money, the money owed will have to be written off by the companies. POAs and families are not responsible for the debt.
Be aware, that paying the minimum on Moms charges does not even touch the principle. You need to pay more to bring it down and stop using the cards. I pay my charges off every month. One month I was late 1 day. Finance charges are calculated before your payment is applied so I was charged. Then I was charged a late payment of $35. I called and told them this was the first time this has happened in the years I had the card. They agreed and dropped the finance charges but left the late charge. So you can see where credit cards can get out of hand. I bet she is paying the highest finance rate.
With a $20K credit card balance, I don't think any bank would want to extend a $10K loan. That certainly isn't following good lending guidelines. Is this a national bank, or a local one? I can't remember for sure which governmental agency regulates national banks, nor am I sure that in the current D.C. political environment that there would be support for pursuing elder financial abuse.
This bank needs to be shamed though!
Aloha, will her brother give you a copy of the loan agreements? I wonder if she really signed or if he signed on her behalf as proxy. If you can get a copy of the loan documents, look for any clauses that allow cancellation after a certain period of time. Some states have these mandatory options for borrowers who change their mind and want to rescind the contracts.
IS her brother totally on the up and up? Just that you threw that in there, last moment. Could he be financially gaining from her loan? Just a ??
Lenders can only seek recourse from the signer, the borrower, UNLESS someone guaranteed the loan. If so, there would likely be a guaranty agreement, but if you didn't sign and you don't know of anyone else in your family who might have, there's probably not a guaranty. In my experience, these are primarily for business loans.
FYI, she lives with her 75-year-old brother and he handles her finances.