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Car & Studen Loan Debt--How to fix?

My in-laws signed for my husband's student loans before we got married, along with the car which we are upside down on (owe more than it's worth). The monthly payments on both are IMPOSSIBLE, and his credit is destroyed. If not for these loans, we would be comfortable. His dad had originally promised to help him pay off the debts when cosigning, with no conditions, then to spite him for marrying me he refused. The only way to get help, is to have a voluntary repo (it won't make his credit any worse) let the loans default so we can get to a third party to help. My husband refuses because it will damage his parent's credit, and instead of helping us when we asked, My MIL wants to SEE OUR BUDGET! Hubby thinks this is a good idea, but that's too personal for me, plus, I do our money. What do I do? Any help would be great...My mother said to never, ever let someone who has vested interest see your budget.

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Anonymous

Asked by Anonymous at 10:34 AM on Mar. 4, 2010 in Money & Work

Answers (4)
  • Why not just call the Student Loan folks and reduce your payment or claim a Economic Hardship and defer the payments until you are in better financial shape to pay it. You can also see about working the debt off. Just talk to them. Their customer service folks are great for helping you figure this out.
    Anonymous

    Answer by Anonymous at 10:37 AM on Mar. 4, 2010

  • OP Here--What the situation is with the loans is that the majority are PRIVATE..we can defer government loans endlessly, but they won't do jack for private loans. Right now, the payment is $157 and we can only pay about $80 a month. They refuse to work with us. I was told by a friend, that since hubby's credit is destroyed, that if we let it default for 90 days, and it goes to a third party, THAT is when they work with you. FIL would flip out, he has a bad temper and has threatened legal action against us before. He is kind of a loose cannon. They chewed us out recently about their credit being destroyed...my take is that he should never have signed & promised to help pay.
    Anonymous

    Answer by Anonymous at 10:51 AM on Mar. 4, 2010

  • Regardless of whether or not your FIL "promised" to help pay, it's not his debt or responsibility to pay....BUT if you and your husband default he can be forced to pay and be sued himself. Your FIL's credit shouldn't suffer because you can't pay the bills? Nor should you be mad at him and your mil because they want to help you both be responsible and work on your budget, because in many cases a different pair of eyes can see cuts. Cut back on luxeries to pay the bills. One doesn't NEED internet or cell phones or cable....these are luxeries that should be the first things cut. Student loans don't disappear, you are required to pay them, a car, however can be sold and paid off....and then you have the money needed to pay the student loan, and perhaps a bus pass or a good pair of sneakers.
    Mom2Jack04

    Answer by Mom2Jack04 at 3:45 PM on Mar. 4, 2010

  • The reasons behind why they will not help is irrelevant. You two are both grown. No one should get a car they can't afford on their own. If they have good credit then maybe them seeing the budget will help because a lot of people claim they don't have enough to cover the bills but they would if they cut out all extras. If he was willing to let them be on the loan as a co-signer he and you also need to be willing to let the parents see the budget before you go trying to ruin their credit. That would be messed up.

    SylviaNCali

    Answer by SylviaNCali at 8:10 PM on Mar. 4, 2010

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