Expert: Chris Ebert - 10/7/2011

Question
My husband died an unexpected sudden heat related death two months ago. We are relatively young, had no insurance and I am not currently working, looking but not working yet.  We own our home outright but we also own a motor home that we paid $225k for and owe $169k and it is worth approximately $100k in the current market. I cannot make this payment and I don't have the cash I would need to make up the difference to sell it. I have an 800 credit score and have never even considered not paying a bill but I can't do this. I have made the last two payments since my husbands death but won't be able to make this one.

I have to call the bank next week but I am not sure what to say.  What do you do in a situation like this?

If my husband were still alive there is no question we would keep it and continue to use it. On my own I can't pay for it or use it.

I don't qualify for bankruptcy. I own my home, our cars are paid for and the other debt i Have is very small, basically only the hospital bills and the funeral expenses plus one other home improvement card. All things that I will be able to pay for as soon as I am working. But even working I won't be able to pay for the motorhome. The payment, storage and insurance comes to approximately $2000 per month.

Thank you for your advice.

Answer
Susan,

In this case I would have no problem calling the bank and explaining the situation. Ask them for a short payoff or a modification of terms until you can sale the RV. You may not be able to sale it for what is owed. Ask the bank if they will help by accepting less than what you owe on the note when it is sold.

Chris Ebert
http://www.henleycreditlaw.com