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Dad's 70 and retired. Has pension and SS income, but no assets. I am trying to advise my parents on how to deal with the enormous credit card debt they have accumulated. Mom is 72 and has some dementia and can’t seem to comprehend that they cannot continue spending. Dad is 70 and I have only just now forced him to take a close look at their debt – he has had blinders on – he didn’t even know the balances on their joint accounts. They are retired, and living in CA.
The good news – they have a large fixed income; social security plus a fixed pension. If they had no debt, they would be doing really well. The bad news is that they have 9 credit cards and a car loan with $118,000 in accumulated debt. They are using over $3000 of their fixed monthly income to maintain this debt. So far, they have been making payments and have a good credit record, but it is becoming more and more difficult as the credit they have available continues to drop. One big necessary expense could put them over the edge. They have pared current living expenses way down, eliminating eating out, and other luxuries fairly well, to the point that Mom feels deprived in her daily life. They have no savings, NONE. No assets (apparently, when they sold the last house they owned, they used the proceeds to pay down other debt) and are now renting. Yes, it is all their own fault.
The problem is they are now at the point that they are going to start having to make a choice between paying on their cards or cutting out things that are really needed. I figure they can afford to pay about $2000 of their income towards debt each month, and need to figure out how they can get there. If it was just my mom, I might favor letting everything start defaulting as there is no longevity in her family. But my dad will be around for a long time; his own mother is still alive and well. I don’t think bankruptcy is a good option, but they have not yet me with a bankruptcy attorney. Their income is too high for Chapt. 7, and I think his pension, since it is paid as income (?), is vulnerable under chapt 13 and I doubt they will be happy with a negotiated settlement of their debt.
Since he does have an income, is a personal loan for debt consolidation a possibility? Would anyone give such a loan with a decent rate to someone his age? If they go to a consumer credit counseling service and turn over all of their card debt, will they work with them to keep their repayment to a level that they can afford? If they declare bankruptcy or use a debt repayment plan, I would imagine their credit will be ruined; if they need to more to a different rental, will I have to cosign for them in the future?
I do have some cash, and part of me wants to pay off some of their debt and have them repay me with no interest, but they have so much debt, I’m not sure I would make a big enough dent in it to make a difference.
Thoughts on where to start?

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Check with a bankruptcy attorney. In the 9th Circuit (which includes CA) their Social Security is exempt from the computation of their payments in a Chapter 13. This ruling is less than 2 years old and has not been widely publicized. They might be able to dump a lot of debt over a 36 month bk. You have to get them to give up the spending habit. Lack of judgment in area of finance can be an early sign of a decline in mental functioning. If you can, find a lawyer who does elder care law and bankruptcy....they are out there. Don't jump at consolidating debt, try to dump it. I wouldn't worry about their future credit rating. The current stress is more likely to cause more harm than a poor credit rating. Lower credit rating, less chance of getting more cards to repeat the experience.
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My dad was in the exact same situation years ago. He and I went over all the options you mentioned and we decided that a consumer credit counseling service was his best bet. Yes, they took all of his credit cards but it turned out that he got along fine without them. And I agree with pstegman, don't cosign anything.
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I don't have an answer for consolidating debt, but if your dad (or mom) are/were veterans, they might be eligible for VA assistance to help with housing costs. That extra income might help cut down on his debt.
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You can consolidate their debt somewhat by transferring the balance of one cc to another, thus cutting the number of cc's they have. With such debt, they would have to pay a larger amount of money each month to ever pay it down. A better solution may be to go to a debt manager. Sometimes they can barter with the credit card companies to reduce the debt, or at least negotiate the interest so that the debt can be paid down more easily.

These things will only work if you get the credit cards away from your parents. If they continue to spend there would be no way to pay the debt down. I would initiate a budgeted pay-go system for them, where they would have to write a check or pay cash for each purchase.
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You can't fix them. Only they can. Forget another loan, they have no equity to mortgage. Credit counseling may help, but only if they are willing to change and it doesn't look like they will. Good grief do not co-sign for anything. I hope they like public housing for seniors.
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