Want to help my old parents

[Randomsaver]

I appreciate all the responses.

What I found out is there is no such thing as guarantor of a mortgage debt, or at least that's what 1 lender person I talked to today said.

The only recourse I could think is I lend my parents money to get the balance refinance-abled. I was really hoping companies would allow guarantees.

[Randomsaver]

They should look into the Home Affordable Refinance Program. When I used it, they effectively waived the appraisal. Hopefully they are eligible for it.

https://en.wikipedia.org/wiki/Home_A...inance_Program
http://www.harp.gov/

Thanks. I printed a list and will explore. The problem is the loan is neither Freddie not Fannie. I don't get why that is a requirement?

[FLA]

I believe if there is a couple who enjoyed life it is them.

But yeah, they already lived a life of enjoyment most people including myself would not have.

how much more could you ask for? good for them

[amastewa93]

That is great! I know that my grandparents were the same way. They truly got to enjoy life. However, they also got investments and mortgages out of the way early on in life, so they did not have this kind of problem.

My 80-year-old grandmother, on the other hand, is still paying a mortgage (less than $300 a month).

I think that this is something that can be different for everyone. Of course owning a home is great, especially when you've rented for so long, but it is truly where your priorities lie (travel over material items, etc.).

[Randomsaver]

^ Exactly. The earlier to get the mortgage out, the better.

I think my parents (since both of them were just HS graduates) did not know the impact of their financial decisions (e.g., 8.75%, consolidating vehicles to mortgages, not adding payment per month).

The only good thing about being poor though and this is really a stretch coz being poor sucks is that the amount of debt they have is close to manageable. Btw, I define manageable as anything less than $100K.

[Joan.of.the.Arch]

If your parents are affording their home mortgage, utilities, taxes, food, insurance, clothes, medicines, etc, I think there is value to just leaving them the heck alone. Why try to tell them they should move as some posters have suggested? Moving is supposed to be one of the most stressful things there is.

You should do all the financial investigation on your own before presenting other possibilities to them. They are adults, presumably happy and well adjusted. So what if they die with mortgage debt?

Is there the possibility that when one dies the other cannot afford to continue in the house?

[Randomsaver]

Is there the possibility that when one dies the other cannot afford to continue in the house?

Definitely.

I would also LOVE to leave them alone after they get refinanced with a lower rate.

Sadly, they are too stubborn to open up.

[Randomsaver]

If your parents are affording their home mortgage, utilities, taxes, food, insurance, clothes, medicines, etc, I think there is value to just leaving them the heck alone.

I also finally able to force it out of them that they had credit card of $3,000. This is a couple who really can't afford it but just are crazy proud to admit their mistakes and seek help.

I am 100% sure their pride won't get them taking to living on housing projects.

It's such a drag.

[amastewa93]

Oftentimes, I have found with my parents, you just have to go ahead and help and not ask them about it.

[Randomsaver]

^ The problem with that though is they don't change their ways. For example, if I pay their $3K credit card debt, what is guarantee they won't rack up another $3K or worse more.

I've been trying to get into a conversation with them where I pay their cc debt BUT I want them to agree to be helped by me to budget the little money they have by cutting down on credit card impulses (damn you credit card companies) going forward, and even living cc debt free within the year. This is my struggle with them, the discussion. Early this year, when I learned their car broke down and they paid $670 via credit card to fix it, I just gave them the money saying not to use credit card.

I couldn't sleep last night because of the breakdown in my talks with my mom. She reclused once again.

I think I know what they're doing and maybe this is something I would only be able to relate to them once I reach that same age. Ever heard of the song by Bon Jovi' Blaze of Glory. I think that is the septuagenarian's sudden battlecry : "Shot down in a blaze of glory!"

To use more credit to continue living their ways when both still have full time albeit low salary jobs. And as Joan.of.the.arch posted above, so what if they die with mortgage debt?

Right now, the thought of that is clashing with my current sensibilities of killing debt. I wonder now if what they're doing is the way to go when you get to that age. Surely, the banks should know that elderly low income people should be capped with lower credit card debts (say $1K) and that schemes like consolidating car mortgage into house mortgage spells disaster to them at high 8.75% rate. Maybe this is nature's way of telling banks that if they are crazy enough to do these things, then they get what is due them.

[ua_guy]

^ The problem with that though is they don't change their ways. For example, if I pay their $3K credit card debt, what is guarantee they won't rack up another $3K or worse more.

I've been trying to get into a conversation with them where I pay their cc debt BUT I want them to agree to be helped by me to budget the little money they have by cutting down on credit card impulses (damn you credit card companies) going forward, and even living cc debt free within the year. This is my struggle with them, the discussion. Early this year, when I learned their car broke down and they paid $670 via credit card to fix it, I just gave them the money saying not to use credit card.

I couldn't sleep last night because of the breakdown in my talks with my mom. She reclused once again.

I think I know what they're doing and maybe this is something I would only be able to relate to them once I reach that same age. Ever heard of the song by Bon Jovi' Blaze of Glory. I think that is the septuagenarian's sudden battlecry : "Shot down in a blaze of glory!"

To use more credit to continue living their ways when both still have full time albeit low salary jobs. And as Joan.of.the.arch posted above, so what if they die with mortgage debt?

Right now, the thought of that is clashing with my current sensibilities of killing debt. I wonder now if what they're doing is the way to go when you get to that age. Surely, the banks should know that elderly low income people should be capped with lower credit card debts (say $1K) and that schemes like consolidating car mortgage into house mortgage spells disaster to them at high 8.75% rate. Maybe this is nature's way of telling banks that if they are crazy enough to do these things, then they get what is due them.

8.75 isn't a great rate, but how much money are they really saving if you add in refinance costs, even if they end up with a rate of say, 3.5%? Would they be paying PMI under the new loan structure? You might find that it's just not worth it.

On the credit card stuff, I can only share what my family did. My grandmother was overspending, and her funds were beginning to run out. She was outliving her retirement savings. About 10 years ago, the family sat down with her and laid down the law. She agreed to let her children handle her finances and they put her on a budget and tracked her spending, froze her credit (mostly to alleviate fraud concerns--she wasn't using credit).

I can see how that would be tougher if your father is still in the picture...if he's anything like my dad, he won't give up control of anything until he dies, but thankfully my dad is excellent with their finances. I still learn from him.

Maybe it's time for that discussion of "you need help" versus "can I offer help". Sounds like that might be a tough sell given their stubbornness. Good luck!

[Randomsaver]

It is. They are the definition of stubbornness coupled with dumbness (don't worry they're my parents, I can say these especially it's anonymous , of course I don't say this to their face.) The worst combination.

It's ok to be stubborn if you know what you are doing. It's ok to be dumb if you are agreeable to be helped. Never ok to be dumb and stubborn.

And they are also very sensitive. It's like I have to watch out my words when I talk to them and sadly for their case there's no sweet words to say.

I guess they'll just rack up all the debt they could get their hands on until they max all the credit cards and banks finally cut them off. Then I'll end up offering them to live with me because of my conscience.

[Randomsaver]

So in totality, I tried to do what my conscience says and offered them help. They turned it down. I went over to the side of Bank Of America to plead to give me their information if Freddie or Fannie, they turned me down. I called up my mortgage company to ask if they can help me via financing to buy my parent's house, they turned me down.

For now, I can say there is nothing I can do. Their house most likely will not get them any equity in the next 5 years (the time I can think of helping them again by offering them to live with me). I was really hoping that if I get it refinanced, in 5 years when they sell, they would get equity that is not only enough to pay me back $10K but also equity (if house sells by 2020 at its current market value of $100K, at 3.5% interest, they would have paid the debt down to 65K, which nets 35K equity -- enough to cover my 10K I plan to give them and 25K of equity for them, see where I'm going with this whole refinancing goal?

I don't see either dying in 5 years. Our family has longevity genes. My grandfather/mother from mother side averaged 83 years; on my father's side, 87 years. average All my uncles and aunts still alive.

On the positive side, the thing is the house is on a strategic location, walking distance from Walmart and restaurants. Me and my kid jog around commercial establishments in the morning when we visit, without car to get to the establishments. The subdivision is really becoming alive now as I saw new owners buying in and demolishing the old houses and putting up new 2-story houses. It' very likely the place would thrive given its location in the next 5 years and maybe the lot value appreciates to give them something back.

[Jovanny]

You can advise them to sell their property and rent another one at lower price.

[snafu]

Is it possible that 'stubbornness' genes are hereditary...passed down from parents? At some point both will cease part time work and face reduced income. If you can persuade them to get their names on a subsidized senior housing list that's progress!

You have outlined the problem. Mom & dad know they owe more on the house than it's current value with considerably higher interest. They chose to ignore how the mortgage amortization table works. Do they realize how little they have paid on principal since refinancing? Those two car balances continue to drain income. The stuff bought on CC will be long forgotten but the interest will be ongoing.