Once upon a time, a little old lady passed on leaving her home to her joint tenant daughter. The daughter, the whole family, was not prepared for this event and didn't even have insurance coverage for the funeral expenses.
You can imagine the kind of havoc this caused for the daughter who now was sole owner of the home. She ended up getting behind on several of her bills and her credit score dropped significantly.
Two years down the line she's still struggling to catch up. She's still paying off bills from her Mom's estate but has managed to cover her mortgage and a student loan, without a single late payment. She's really trying hard.
The good news is that her credit score did manage to creep up high enough that FHA - much less FICO sensitive than conventional or even sub-prime lenders - is going to be able to help her. The credit score: 485. The loan to value ratio 80%. The rate: 7.5%.
No one else was able to help and even if they would have been able to, the rate would have been so high that she couldn't have afforded her new monthly payments and what would be the point of that.
All of her old debts are rolled into her mortgage and because the rate is lower than her previous mortgage, it actually saves her money each month. It would have been nice if there had been some other solution to get her out of debt - say for instance, a huge chunk of cash falling from the sky - but bankruptcy was not an option and this pays off a judgement, stops a wage garnishment and overall manages to make her budget work better than before.
We've discussed putting some monthly savings away each month so she'll build up a buffer and maybe can get back to contributing to her 401K plan at work. At least she is no longer walking on a knife edge waiting for a fall. Sometimes things do work for the good for those who believe.
It's nice to be able to make a positive difference.
Oh, and it looks like they'll all live happily ever after.
Well, I hope so anyway.