My folks are 77(Dad) and 72 (mom) years old and are Realtor/Brokers in Central Florida.
My dad has been in and out of the hospital for the last month. Doctors think it's treatable but he needs to take it easy.
They are over 90k in debt. My dad says a little more than half of that is personal debt and the rest is in their company's name. Their company (which they run out of their house) isn't breaking even and they've been borrowing from crazy places like Kabbage etc to cover gaps.
Last year's return showed they earned only a $2k profit for the whole year. (Note that they run the company out of their house, 3 bedrooms are devoted to office space). They've got a brokerage so they also have agents working with them and an account with a national bank so they receive occasional foreclosed houses to deal with (evictions/repairs/HOA violations the works). They have a remote office assistant who takes calls and does the tedious paperwork he's able to do who works for them for about $1400 a month.
They have a 2 year old van they are making payments on and one that is paid off. They have about $100k equity in their house and they get roughly $1900 a month from social security.
Their house is a large house in a fairly nice area of town and the mortgage costs about $1850 a month. They have about 90k in equity. Maybe they could refinance it to lower their payments? I worry about if their current debt situation would make this too costly as I doubt their credit rating is great.
So I think it's something like this:
- Food $600
- Entertainment ($150 cable+internet plus $100 various?)
- Mortgage $1850
- Medicare gap Insurance with Blue Cross Blue Shield $400
- Car $500
- Prescriptions $100ish
- Lawn Care $100
- Utilities $300
Income is $1900 in social security
Should they do bankruptcy? Would they keep their house, car and equity? They've gone bankrupt twice before and I know lows are more strict now.
My siblings and I have thought about moving them to an apartment so there's less stuff and less expenses, but the rental market is so high right now (average for the metropolitan region is $1300 for 1000 sqft/2 bed) that we're not sure if this is such a good idea. We want them to cut down on their expenses and do less but in a way that's going to be predictable over the next decade or so.
My thought is if we could get them down to selling a house every other month, and they could forward all their other leads to other agents they know, and take occasional clients. One of my siblings who works with them thinks that selling more than that is unrealistic with the current state of the market.
My mom has gotten a substitute teaching job where she can pick up shifts from the county, but she's got bad hips and a bad back so it's not sustainable for her to do this very often. I don't know how much income this generates yet.
I just worry about the toll the stress is taking on my folks and I fear a downward spiral. How can I get them to break even with their SSN income? Also, anyone have tips on talking to them? We've asked our pastor to help with this. It's a matter of pride with my folks. They have envisioned selling their business eventually to retire on, and I know little of business or real estate brokerages but it's hard to imagine selling a business with no assets, debt, a few agents that work with them and an account with a major bank.
Suggestions?
Submitted September 04, 2018 at 05:58PM by DependentMacaroon https://ift.tt/2wCBxac
