Helping Family Member with Debt Relief

[GoConfidently]

Hey there smart people. I am in a bit of a time crunch and have searched the forums (poorly, I'm sure) for answers to these questions to no avail.

Situation: family member (FM) is 57 years old, on the cusp of losing job in healthcare because of medical condition (allergies to latex that prevents the use of appropriate PPE in Covid times). Currently on administrative leave with pay as of this morning for 15 days. They are being offered a transfer to any open job in the company, but cannot qualify for a promotion in title or pay, and will likely result in demotion. Cannot refuse any job offered or it will be considered a resignation. Two dependents aged 18 and 19 (complicated, but neither in college and one currently living at home). FM currently rents in MCOL area, month to month.

Problem: 40k in CC debt on 3 cards. No monthly charges, but not paying enough to make a dent in the principal. Interest ranges from 15-24%. Credit score is currently right around 700, so keeping their head above water at the moment but no chance of that if pay is reduced.

Potential solution: Family member has been offered a job and ability to rent a house in a rural area about 10 hours away. Offer is from FM's sister who owns a business and rental properties, but the rental is not vacant just yet. FM has stayed in the home before it was rented and liked it. The job sounds boring and is not in their field, but no job in their field is a possibility right now because of PPE issues. Getting more info about the job, but the monthly rent is $250 compared to current rent in this area which is $1350/month. Availability dates and details are being gathered tonight, but I am recommending they take this option seriously. Because youngest child recently graduated, this is the first time in a long time that relocation is possible (divorce agreement).

Why I need help: I have offered help with resume rebuilding and debt counseling. I have crawled my way out of debt before, but I did it the hard way because most of it was student loans. I need help negotiating with credit card companies. I've been on the FTC's website and looked at a few of their recommended credit counseling agencies. I would love to help FM avoid bankruptcy, but it's not off the table (part of this desire is definitely wanting to keep FM in good credit so they will have options other than relying on me).  I'm willing, and able, to do what I can to help this person make decisions that will put out their hair-on-fire emergency, but I feel a little overwhelmed. I know they feel a lot overwhelmed, and we're starting from square one with a paper budget. I am willing to help with relocation costs, but not willing to take them into my home (again).

Question: Is there a "script" for dealing with credit card companies if you want to settle a large debt? Has Covid ruined our chances of getting to debt reduction easily? Or made it more likely? Should we ask for a freeze on the accounts? Is consolidation the key? I'm at a complete loss when it comes to credit cards. Should we just pay the fee to get a debt coach? Unfortunately, all my hours of watching Til Debt Do US Part hasn't prepared me for this real life situation :) Thanks for any pointers!

[ixtap]

Is nitrile not acceptable as proper PPE?

[GoConfidently]

Is nitrile not acceptable as proper PPE?

Masks, not gloves, are the problem. The OR provided masks have latex straps and the alternatives (personal respirators of some sort) are either not approved for surgery or cost prohibitive for the hospital to provide.

[mitchm]

I think you'll find some useful info in this book. Online edition currently free cuz https://library.nclc.org/sd

[plog]

First and foremost---Dave Ramsey.  Google that and get on his plan.  Now I will channel him and answer your questions.

Is there a "script" for dealing with credit card companies if you want to settle a large debt?

Yes, don't pay them for 4 months and then start negotiating for dimes on the dollar.  With a 700 score sounds like they are current in everything.  Credit companies aren't going to make a deal with a customer they have faith will ultimately pay.  The customers they think won't pay are the ones who can make deals.  Time to trash the credit score if you want a deal.

Has Covid ruined our chances of getting to debt reduction easily? Or made it more likely?

No and no.  Covid has nothing to do with a reduction.  However, I hear its a magic word that can be used to suspend payments and interest for a while.  Some companies won't ask if you have been effected by Covid, but if you bring it up by yourself they automatically grant certain leniencies.  Mention it and see what you can get.

Should we ask for a freeze on the accounts? Is consolidation the key?

Freeze is semantics.  Not charging any more is the key and you say they have that under control.  Consolodation isn't a panacea and can actually be a bad thing.  You move $40k from credit cards to this new "better" debt vehicle and feel like you did something and feel like its ok to start charging "just little things" back on the credit cards.  And boom now you are back to building your credit card balances.

Should we just pay the fee to get a debt coach?

Get on Dave Ramsey's plan.  Getting out of debt is simple (the math and path out is easy to understand) and difficult (the discipline to have faith in and follow the plan).  Again, Dave Ramsey. 

[Morning Glory]

I am detecting some bullshit, or at least a lack of flexibility, in FM's story here. I am guessing he is a surgical technician?? Latex allergy is common and I am quite certain that there are non-latex options available if FM would talk to occupational health (unless we are talking about a tiny hospital here).
There are also plenty of jobs in the hospital where a regular procedure mask is appropriate (I get that some would feel like a demotion). There are even work from home jobs in healthcare.

TLDR: Do not give money to this person. Advise the person to take the transfer and go back to the OR once the threat of Covid passes, or the hospital can provide a different mask.

[BikeFanatic]

I have been in the same boat as far as allergies. I went to dermatologist and they tested me for 100 allergies and lucky latex wasn’t one of them. Still I was allergic to rubber, and the preservatives in soaps, so on my own I found a desk job in the same hospital. It can take 6 months to a year for rashes to clear even after exposure. Health care dermatitis is not so rare, and over exposure to chemicals can result in an allergy at any point even at 60 years old or older. If family member is a RN there are case management jobs and clinical documentation improvement well as sales jobs that are high paying.

A latex allergy can be pretty severe and deadly if there are respiratory symptoms. Not sure I would work in a hospital if I had chance of anaphylaxis.

[kite]

I am detecting some bullshit, or at least a lack of flexibility, in FM's story here. I am guessing he is a surgical technician?? Latex allergy is common and I am quite certain that there are non-latex options available if FM would talk to occupational health (unless we are talking about a tiny hospital here).
There are also plenty of jobs in the hospital where a regular procedure mask is appropriate (I get that some would feel like a demotion). There are even work from home jobs in healthcare.

TLDR: Do not give money to this person. Advise the person to take the transfer and go back to the OR once the threat of Covid passes, or the hospital can provide a different mask.

Winner Winner Chicken Dinner.