Frustration with family and loans

[Dreamstalker]

Over the years, my mom is into me for almost $30,000 in assorted loans (all of which I was assured she would repay; somehow when the house sold and there was a lot of extra cash that agreement was forgotten about). I've been far nicer than I had to be and never charged interest. This goes back to about 2004 or so; a lot of it was my grandparents' medical bills which (Medicare should have covered and) I was assured would be repaid within the month.

Yes, we're both scrambling now. Myself moreso, as I want desperately to get my debt-to-income ratio down as employers (especially government) will look at that. At least one of the small credit cards I took out for a balance transfer is actually her debt (we had to use my name and credit score to get it, I was assured that she would take responsibility for payment). I'm having to ask my dad for my share of the rent which never should have happened; I know it's causing some amount of financial strain on him as well. Other stuff has happened involving a trust account of mine that only I should have had access to, but was put into her name to avoid nonexistent 'problems'; I have no way to prove anything but I have suspicions.

I just cannot forgive that large an amount, even for family (that was my therapist's only suggestion). I wish my financial situation was good enough that I could, but I can't.

I've tried to talk to her about it and get the feeling that while she does get it, she doesn't quite understand how serious this could be for my job prospects (even if it isn't, I want to get everything paid down--that's what the trust was supposed to be for if I didn't have a job).

It's a bit too late to get stuff in writing, but I'm going to see if there is any way that she could start contributing to my credit cards at least.

I just had to rant about this. With my freelance work, any balance is due in full within 30 days. My boss pays me on time. Am I going to have to start getting a signature (not that there can be anything done with it legally) each time mom borrows money from me?

[ArcticChicken]

Am I going to have to start getting a signature (not that there can be anything done with it legally) each time mom borrows money from me?

STOP. LENDING. HER. MONEY.

[Lyse]

I have to agree - absolutely no more money should be given to your mom.

[Aethian]

Why did you let the lended amount get so big? I would have stopped way before it became this bad and this old. It's time to have a come to jeebus talk with your Mom and lay this all out on the table. Preferably do this with a third person present that can act as a mediator. Have paperwork right there to sign to make her start paying it. Hell you can even say "Mom you owe me X but I will take Y which is 75% of what you owe me IF you start paying me now and don't miss a payment."

[PawnPrincess Ardra]

I really like Aethian's idea... I hope you get something sorted out. Family relationships are difficult enough without adding money into the mix :-(

[Maria]

Eek, just saw the whole post, and this is WAY longer than I thought it was, sorry! Would shorten, but I'm late for class already.

Okay, I don't know your situation, or your mother's or why you have elected to lend her money. My first reaciton is to say, accept that she likely won't pay back even a cent, and don't lend another penny. But, I have been there, and I get that it's probably not as simple as that. I'd like to share my very long-winded experience anyway, because I suspect that it may help you (or somebody else reading) to decide how to handle the situation.

My mother-in-law used to borrow money often. Her parents gave her money, her brother paid, she "borrowed" her eldest (the one I married) child's money from babysitting or mowing lawns, then "borrowed" from his paychecks as soon as he was old enough to get a part-time job in our area. She also borrowed his SSN to get utilities turned on and apartments rented in spite of her bad credit, and didn't worry about leaving all the evictions and whatnot on his record, with the mistaken belief that it would all go away when he turned 18. It didn't.

And the longer it went on, the braver she got. She started taking from the younger kids, and helped her parents to get a second mortgage that I doubt they ever understood. She once forged checks out of DH's checkbook, running up about $200 in overdraft fees way back in the days when it only cost about $30 to bounce a check. By the time DH and I cut her off, she had "borrowed" upwards of $25,000, plus leaving 2 apartment evictions, and about $2000 in unpaid utilities, and PPV porn. (OMG, if the cable company says you owe $300 for one month of TV service, don't ask what for -- they will list titles!) She even took the 10k her parents had willed to her own adult daughter, earmarked for the young lady's cancer treatment. And yes, it DID affect the kinds of jobs DH could get. He worked fast food and gas stations and stuff, for 6 years, before he could get a job in his industry, because of it.

What happened when we put a stop to it? Others started to realize that "no" was an option, and then came the fighting, wailing, gnashing of teeth. Lots of names called, accusations thrown... it was hard, very hard, and I would have given anything (except my income and my future!) to not go through all that. But once she realized nobody was planning to give in, she figured out how to live within her means, in spite of some really serious limitations. There is no end to this woman's creativity in solving her problems, and as hard as it was to help her learn that, I am so glad that she didn't leave this life without discovering that about herself. The woman I used to wish awful things on, over money, is now one of my closest friends. It's been worth the ugly things the family has gone through, and I wish it had been done a whole lot sooner.

So, that's what I learned, going through my situation, and I hope somebody can take some wisdom from it, and use that to help improve their own life situation. Good luck in deciding how to best handle your individual situation, and in following through on those choices.

[Raveni]

Hi there, not to pile on, but everyone above me here has given great advice. It's obvious that you love your mom so much that you can lend her money when you don't really have that much to give. Cutting her off from getting more money would probably be best for BOTH of you.

But that's not what you asked for help about.

See if there is a local bar association (lawyer bar, not alcohol bar) that offers free mediation. Drive your mom over there for your appointment and work out a fair agreement as to what the balance is and how it will be repaid. Get it in writing. Understand that you may have to "forgive" some of the debt if she won't agree she owes it (like medical bills for someone else). Stick to it. Don't be afraid to send certified letters to your mom to remind her or if she doesn't pay. Even if she swears she will just be "a little late this month" or "will pay double next". At least you will have a paper trail in writing. If you really don't want to forgive the debt, you may have to sell your debt to a collection agency. I have no idea which ones are reputable near you. They will most likely have the means to persue the debt and make it go on HER credit.

In the end, anyone lending out money has to be prepared that they will never see it again, "even for family"... If it's causing hardship for you and your family, it's best to stop doing it until you can afford to never see the money you loan again.

[Dreamstalker]

I haven't (voluntarily) made any loans since 2007. While I do need to contribute to rent, cable, etc...I can't continue that for much longer unless I'm paid at least some of what I'm owed. It's a weird situation.

The trust I mentioned was intended for me to be able to pay my own bills if I didn't have a job; I think some of the money went toward my grandparents' medical bills without my knowledge (or consent). That money should have come out of the estate when the house sold.

I think my therapist has finally seen what's going on and why I cannot forgive the debt (I wrote out a fairly detailed email about what I was owed, what I needed that money for and ideas for repayment). Mom already had to declare bankruptcy over the medical bills, and both of us are literally living paycheck to paycheck now.

[auntiem]

It seems like the biggest concern is the credit rating aspect (I understand you want to get paid back, but currently the credit report for employment is your main concern - correct?).
I went to a talk a few months back where a man from the credit department of the local bank was discussing this kind of issue. Namely one big expense (large loan not paid back / huge medical bills etc.) causing a domino effect with your other bills. He said that you may be able to work with a banker to help you improve your credit score.
If your Mom has declared bankruptcy - then there may be a way to clear the loan off your credit rating - essentially write it off as a loss.
They may also be able to point you to who can help you with researching your trust - if anyone accessed it to pay for something not intended in the trust then I think you have a very good chance to get a paper trail going and/or a legal standing to pressure your Mom into paying back the loan and the money taken out of the trust.

[protege]

One thing I've learned...is to never make loans to family members. It's just not worth the drama and bullshit. Trust me on this.

Some of you might remember that my parents used my checking account as their own personal S&L over the years. Nearly every cent of my paper-route money...went to pay their bills. Lots of excuses about why I wasn't making any cash, and lots of empty promises about repayment. Since I was a minor at the time...their names were on the accounts. As such, there was no way I could prove that they'd taken the money. To this day, they refuse to talk about it.

Final straw came, when I was still living there. My mother had written out a check for $500 to get one of their shitbox cars fixed. At the time, I was in the process of switching banks, and finally removing their names off the accounts. When the $500 check was written, I had no idea about it...until I got that month's statement. When confronted, my mom actually said that she wasn't going to pay me back. Instead, she'd put that $500 towards my rent. 5 months of rent at one time put a big dent in the finances for awhile.

After that, they don't get a dime. If they're having money problems...they have to deal with it. Protege's Savings and Loan is closed.