Last year, I went through a really tough separation. I left my ex, and it wasn’t easy. We have three kids together, and he didn’t make things any better. He refused to move out of the family home and took the car, which was in his name, so I had to start from scratch.
My cousin, who has a good job and earns nearly $10,000 a month, offered to help me financially when I had nowhere to go and nothing to my name. Over the course of a year, she lent me $20,000 by taking out a line of credit.
The separation left me with a lot of unpaid credit card debt, and my credit score has taken a big hit. But I’ve slowly started to rebuild my life. I now have two jobs, and soon, I’ll have a steady income.
I wanted to take out my own line of credit to pay her back and manage my debt, but my credit is so bad that the bank won’t approve me. I’m feeling really lost. My cousin needs the money back, and the stress of it all is keeping me up at night. 
What options are available for someone in my situation? Any advice would be so appreciated! I’m in BC, Canada.
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It is what it is if you don’t have it. I would, however, set myself a strict budget and try very hard to pay her as soon as possible. Any surplus funds are given to her. No travel, dining out, etc. until she receives payment.
This furthermore, it’s unexpected that the cousin anticipated receiving this much money back in a year from someone who was “starting over” after a traumatic experience, presuming she was aware of all the circumstances.
It is now clear to your cousin that you should never take out a loan for someone you cannot afford to lose, nor should you lend money to them.
Do you have a divorce? Did it provide you with any benefits? Do you have a job? Is he providing for the kids? Does he bear half of the debt on the credit card? There is a ton of information missing here, other than the fact that you are not paying your debt to a family member and that you both ought to have understood the likelihood of you being able to accomplish so was slim.
Make a meal plan, stick to a budget, and give up any vices you may have. Boost earnings, cut costs, and reimburse your cousin.
Is there no plan for repayment? Even if it has been a year, she took a great risk by doing all of this for you.
Do you have something for sale?
I’m curious about what the original plan and timeline for repayment were. Considering the situation when you were loaned the money, it seems unrealistic to think you could repay a $20k lump sum or secure a loan within a year. Have you discussed a payment plan with her or tried to make any payments to show that you’re committed to paying her back?
I have a friend who owes me $600, and it frustrates me to see her taking trips on Facebook while she still hasn’t paid me back. It’s not about the trips themselves; it’s the lack of any effort to repay the money, especially since it’s been almost two years. If she had just paid $25 a month, she would have nearly paid it off by now. I think it’s crucial that you talk to your cousin and work out an agreement on what you can reasonably pay. You never know—your cousin might even help with part of the payment until you’re in a better position. The key is not to ignore it and try to pay something each month.
Begin paying $250 or $500 every month in good faith. It’s better than nothing at all, because it demonstrates your effort.