My reason for urgently needing a HELOC

[FUEGO]

In general, how is this thing handled in a divorce? If he divorces her tomorrow, does he have any responsibility concerning the debts? I'm guessing "no" because they are all illegal and off the books (?)

Good question. The CC debts will most likely be divided up equitably along with whatever assets they have. I imagine the gambling debts will not be considered in the equitable distribution of property since they are not valid debts (void since they are illegally contracted). I'm not sure if our state has a provision in the equitable distribution statute to allow a disproportionate share of assets (or smaller share of CC debt) to be awarded to the non-gambling spouse due to gambling spouse's malfeasance.

Most likely, if gambling SIL gets an attorney for the divorce and custody proceedings, I imagine she may not disclose any of the gambling debts if custody is in dispute. Seems like that might cut against her worse than sticking her ex with half of her gambling debts. Her kids are worth more than $10,000 or so I imagine.

On a different note, I forgot to mention that the vig on this $20,000 works out to $1650 a month. Clearly unsustainable given SIL's income and her husband naturally is not paying any of that vig. On the bright side, I'm not aware that anyone in the family has been hit up for money since April. And she is probably tapped out on new CC applications. Her last one from a few weeks ago had a $400 credit limit. Not very helpful given the size of the vig and her gambling loss burn rate. My prediction is this is going to end very badly for her in one or more respects very soon unfortunately (or maybe fortunately over the long term??).

 

[donheff]

I hope you BIL has frozen his credit. He ought to freeze his wife's also. Let her figure out how to undo it

 

[Martha]

Donheff has a good point. A friend of our some years ago ended up getting a divorce. Shortly afterwords his exwife started applying for and getting credit cards using his identity. Periodically for several years she did identity theft on him. It was very messy to clear up.

 

[FUEGO]

I guess if SIL does that, her husband's concerns over custody may be resolved by SIL going to the big house for identity theft/fraud.

 

[Nords]

On a different note, I forgot to mention that the vig on this $20,000 works out to $1650 a month.

Am I reading that number right? 100% APY?

I guess if SIL does that, her husband's concerns over custody may be resolved by SIL going to the big house for identity theft/fraud.

I doubt it. The judge would see this as an tragic but isolated case of addiction & rehab, perhaps with heavy community service & probation.

It'd be a different story if she started embezzling or stealing from other non-spouse sources to pay her gambling debts.

Either way the DH would have to assume that she'll take him for whatever she can get and would have to protect himself by getting out of the joint accounts, changing the door locks, freezing his credit reports, and doing whatever he can to keep his identity from being used against him. I wonder if that involves letting the police know up front about the problem.

 

[haha]

This woman is undoubtedly good at making herself look sweet innocent and perhaps sexy. What is DH? Only a man. He should do everything is his power to get rid of her as cheaply and quickly as possible. Find him a good lawyer. In fact, perhaps he should consult all the barracuda divorce lawyers nearby to shut her out as best he can.

Ha

 

[FreeAtLast]

My FIL lost everything years ago. The big house, a successful due to gambling losses.
He went bankrupt, moved his family to Florida and started rebuilding his business working as a repairman all over again. He eventually built the new business back up and then did an early retirement 10 years later. I only know bits and pieces and I think he settled for less than was owed.
It was in was well over 100k about 40 years ago.

 

[Bestwifeever]

I know of a family where one of the parents opened up credit card accounts in the kids' names and ran them up. Fuego, maybe everyone in the family, including your DW, should freeze their credit.

It doesn't seem as if there can be a good ending to this story.

 

[Sue J]

I had to look up "vig".

Vigorish - Wikipedia, the free encyclopedia

Vigorish, or simply the vig, also known as juice or the take, is the amount charged by a bookmaker, or bookie, for his services. In the United States it also means the interest on a shark's loan. The term is Yiddish slang originating from the Russian word for winnings, выигрыш vyigrysh. Bookmakers use this concept to make money on their wagers regardless of the outcome. Because of the vigorish concept, bookmakers should not have an interest in either side winning in a given sporting event. They are interested, instead, in getting equal action on each side of the event. In this way, the bookmaker minimizes his risk and always collects a small commission from the vigorish. The bookmaker will normally adjust the odds, or line, to attract equal action on each side of an event.

I thought I already knew all the important Yiddish slang.....

See the link for the full description.

 

[Leonidas]

Am I reading that number right? 100% APY?

It's amazing what is possible when your friendly debt collection counselors go by the names Baby Stomper, Dirty Red and Bullet Head.

 

[FUEGO]

Am I reading that number right? 100% APY?

There are amounts owed to different people. Some debt is at 10% a month, some at 5%, some at none. 10% a month is 214% APR, and 5% a month is 80% APR.

 

[haha]

There are amounts owed to different people. Some debt is at 10% a month, some at 5%, some at none.

Be careful Fuego. Dopers, drunks and gamblers have a character disorder. Your goal should be to know as little as possible about their lives. Many people have drowned trying to pull a floundering swimmer to shore.

Ha

 

[Lisa99]

and please caution your BIL that he may not have discovered the full extent of her illness.

A good friend's wife has a gambling addiction. She had dozens of credit cards maxed out, she refinanced their house twice, each time forging his signature (had a forged power of attorney). Just before the bank foreclosed on their house she emptied their bank account and left town. He found out about the extent of her problem when he got the foreclosure notice.

He's a medical doctor and was about 2 years from retiring when this all happened. It's now 10 years later, he divorced her and is remarried to a wonderful woman, but his early retirement dreams are gone.

You're wonderful to understand and emotionally support your BIL but Ha knows what he's talking about. Please be sure to take care of yourself in the process and don't get sucked into this mess emotionally or financially (you've done an admirable job on this last point)

 

[ziggy29]

A good friend's wife has a gambling addiction. She had dozens of credit cards maxed out, she refinanced their house twice, each time forging his signature (had a forged power of attorney). Just before the bank foreclosed on their house she emptied their bank account and left town. He found out about the extent of her problem when he got the foreclosure notice.

My father in law remarried after my wife's mom died to someone who, unbeknown to him, had several aliases and a criminal rap sheet a mile long. She got him to accept power of attorney on an account for an elderly man she already had POA for. Not only did she max out all of his credit cards (to the tune of about $50K) but she committed fraud and stole tens of thousands from this account.

Which got him in a heap of legal trouble since he was on the account and signed a couple of checks to buy him groceries, even though he did nothing wrong (other than trusting her). He's still paying off the restitution from the plea deal that kept him out of prison as well as tens of thousands in credit card debt. If he didn't have a good pension he'd be living with us, I have no doubt.

 

[FUEGO]

You're wonderful to understand and emotionally support your BIL but Ha knows what he's talking about. Please be sure to take care of yourself in the process and don't get sucked into this mess emotionally or financially (you've done an admirable job on this last point)

I always look out for #1 of course. Emotionally, I think I have accepted that this isn't going to end well. At the end of the day, this situation sucks for BIL and his kids, and my DW's parents are going to be crushed by the inevitable divorce as well (and admitting that their daughter lied to them and cheated them out of $15000 that we know of).

At the end of the day, this isn't my bag of crap that is stinking up the place. I may have to get a whiff of it when around the SIL, but at the end of the day, the bag of crap doesn't come home with me, just a little whiff. This deadbeat isn't getting any of my money, and I think it is safe to say that all the rest of the family, except SIL's mom is extremely pissed at her.

As to the extent of the illness, I have acknowledged all along, and reminded others in the family that we may not necessarily know about all the various debts, credit card debt, loans, etc. The SIL has been manipulative and secretive all along, asking each person in the family separately, and asking it be kept secret. Once everyone started talking, it came out that all of us have been approached by SIL.

 

[REWahoo]

FUEGO, I ran across the perfect holiday gift for your sister in law:

 

[FUEGO]

FUEGO, I ran across the perfect holiday gift for your sister in law:

Pretty long odds she would appreciate the humor in that shirt.

For a little update: no new news. Thanksgiving dinner is at her house next Thurs. I'll reconnoiter a bit and give a real update if there is anything to share.

 

[clifp]

Pretty long odds she would appreciate the humor in that shirt.
.

How long are the odds? I'll take some of the action oh and can I have your SIL email.

 

[FUEGO]

Update (for those still following the thread):

BIL (husband of gambling SIL) talked with me yesterday over some Thanksgiving turkey.

A mixed bag of news. They sold the gas-guzzler SUV and kept the cash. Then bought a brand new mid sized sedan and financed it. So now they have probably $20k in cash from the sale of the SUV, and a new car payment. A good temporary fix to provide liquidity and reasonable transportation.

As an aside, I am shocked they were able to obtain financing on the car since they apparently have bad credit (haven't paid a credit card bill in 3 months, etc), and mostly self employment or undocumented cash income (tips). Guess it is 2007 again!

The SIL has stopped gambling for 4 weeks now, but BIL admits it is mostly because there just isn't any cash left. I guess he's hiding the 20k cash from the SUV sale from SIL.

SIL and BIL hosted the family Thanksgiving at their house. The spread was smaller than years past, but still way more food than we could all eat. Guess they dipped into the $20k to buy all that food.

BIL says he has taken over administrative responsibility to pay the bills and manage the debt. He has been at it for a few months. He has asked to sit down with me for a few hours this weekend to go over all the bills and terms and try to make sure he is handling them optimally and talk about options to pay them or renegotiate or something else. I mentioned to him that at some point bankruptcy may be the most viable option.

We also discussed (and he understands) that there are two issues: (1) stopping the gambling that is causing continued loss of money and major familial distress and (2) managing family finances to keep the assets you want to keep and start rebuilding your finances.

I may have another update after the weekend meeting, and may bounce some ideas off folks here re debt and options.

 

[BigMoneyJim]

Thanks for the update. I do hunt down this thread periodically to see if there is anything new.

I don't know much about bankruptcy and not much more about gambling addicts, but let's say there is a high statistical chance of her gambling away the family's financial stability again after declaring bankruptcy and getting the money situation back in order. From what I've heard, you can't declare bankruptcy again within 10 or so years, so credit card companies in particular will grant credit again knowing they can rack up interest for years until the next bankruptcy filing. In other words, if the root cause isn't cured then bankruptcy doesn't help for long, and since it can't be refiled in short order you're kind of trapped with any new debt incurred.

Bad scenario: She isn't gambling now because there's no money. Declare bankruptcy, get settlements in order, now you (er, he) have some money. She starts gambling again.

And I'm pretty sure bankruptcy doesn't much affect illegal gambling debt, and she's obviously gambling either with idiots or sharks, because those are the only types that would let you bet I.O.U.s. I doubt idiots would last long enough in the games to cause her great losses.

Now I'll venture from the-realm-of things-I've-casually-heard-about into pulling-things-out-of-my-behind: It seems like it would be a good idea to separate the finances in a way that the husband's and kids' money to pay bills and buy food are kept somewhere she can't legally or successfully access, and make it so she can't open joint credit or any credit that affects the husband's or kids' credit ratings. Naturally I have no idea how to do that and not sure it can be done without divorce.

 

[haha]

Thanks for the update. I do hunt down this thread periodically to see if there is anything new.

I don't know much about bankruptcy and not much more about gambling addicts, but let's say there is a high statistical chance of her gambling away the family's financial stability again after declaring bankruptcy and getting the money situation back in order. From what I've heard, you can't declare bankruptcy again within 10 or so years, so credit card companies in particular will grant credit again knowing they can rack up interest for years until the next bankruptcy filing. In other words, if the root cause isn't cured then bankruptcy doesn't help for long, and since it can't be refiled in short order you're kind of trapped with any new debt incurred.

Bad scenario: She isn't gambling now because there's no money. Declare bankruptcy, get settlements in order, now you (er, he) have some money. She starts gambling again.

And I'm pretty sure bankruptcy doesn't much affect illegal gambling debt, and she's obviously gambling either with idiots or sharks, because those are the only types that would let you bet I.O.U.s. I doubt idiots would last long enough in the games to cause her great losses.

Now I'll venture from the-realm-of things-I've-casually-heard-about into pulling-things-out-of-my-behind: It seems like it would be a good idea to separate the finances in a way that the husband's and kids' money to pay bills and buy food are kept somewhere she can't legally or successfully access, and make it so she can't open joint credit or any credit that affects the husband's or kids' credit ratings. Naturally I have no idea how to do that and not sure it can be done without divorce.

I think is some states it can be done with legal separation, but who knows how well it might stand up if she were to mount a challenge.

Ha

 

[NW-Bound]

... and she's obviously gambling either with idiots or sharks, because those are the only types that would let you bet I.O.U.s. I doubt idiots would last long enough in the games to cause her great losses.

Not if these are not simple idiots, but murderous brutish thuggish violent idiots.

 

[FUEGO]

Bad scenario: She isn't gambling now because there's no money. Declare bankruptcy, get settlements in order, now you (er, he) have some money. She starts gambling again.

I have gone over that with BIL. Hence the two pronged problem - stopping the gambling and then rebuilding the finances.

BIL is trying to get his wife to understand that you can always stop and start from scratch (or some version of it) and get back your family, your dignity and your future.

And I'm pretty sure bankruptcy doesn't much affect illegal gambling debt, and she's obviously gambling either with idiots or sharks, because those are the only types that would let you bet I.O.U.s. I doubt idiots would last long enough in the games to cause her great losses.

Well, bankruptcy does discharge all debts generally. But yes, I don't think her fellow gambler creditors will respect the judgment of a US Bankruptcy judge much. The good news is that I think most or all of her creditors are of the simple idiot type and not the knee-breaking type. Reneging on the debt to these folks will just get her socially ostracized and will prevent her from being able to gamble any more with them. Which is a great thing.

I don't know the current amounts owed anymore or to whom exactly, but BIL mentioned $30k as being what she owed. I'm assuming that is owed only to various gambling counterparties. That is on top of a few ten thousand in CC debt, and probably $15000+ she owes to non-gambling family.

 

[haha]

I don't know the current amounts owed anymore or to whom exactly, but BIL mentioned $30k as being what she owed. I'm assuming that is owed only to various gambling counterparties. That is on top of a few ten thousand in CC debt, and probably $15000+ she owes to non-gambling family.

So maybe $50,000 total debt, this perhaps underestimated too. I assume that you know this is hopeless, but keep up with it for the entertainment value? It is probably hopeless even if she were to change overnight, get a straight job and start saving.

Ha

 

[BigMoneyJim]

I assume that you know this is hopeless, but keep up with it for the entertainment value? It is probably hopeless even if she were to change overnight, get a straight job and start saving.

It's his SiL, so he kind of has to maintain hope. From a distance we can see bleak odds, but when it's in the family somebody has to maintain a path to hope.

People rarely change, but some do, and they're probably worth all the effort as long as the helpers protect their own interests.