A luxury jewelry buying spree due to mourning the death of her husband almost ended with a widow being thrown out onto the street. Only after exhausting and lengthy negotiations was the debt cut in half - and the woman's house saved from sale.
And here's the thing: After the sudden death of her husband, A. [pseudonym], a widow and mother of four children, found herself alone dealing with heavy grief and full responsibility for running the household.
Her husband died of cardiac arrest about a decade ago, when he was in his 60s, and from that moment on, the entire financial burden fell on A.'s shoulders. According to her, it was a profound breaking point: in a short time, she was forced to deal not only with personal loss, but also with existing debts, ongoing obligations, and a financial reality that she had not previously managed alone.
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During the years following her husband's death, A. began taking out loans to finance living expenses, and at the same time, during the period of mourning, she fell into a binge of unbridled purchases of expensive jewelry, financed through credit and revolving loans.
According to her, it was a destructive mechanism through which she tried to cope with the deep emotional hole that had opened up in her soul and with the uncertainty about the future. Later, after she came to her senses and realized that she had gotten herself into a financial hole, she sold the jewelry to finance other expenses, but this move failed to halt the deterioration.
Checks she sent were not honored, and the total debt grew.
According to her lawyer, Attorney Mali Taib, A. lives alone in a four-room apartment in Holon. The apartment has a monthly mortgage, and over the years, a cycle of loans has also been carried out, including taking out a reverse mortgage, so that the remaining debt secured on the property was approximately 760,000 shekels.
In total, A. accumulated debts of over a million shekels to 21 creditors, including banks and credit companies.
During 2022, A. realized that she could not continue to operate like this, with all her accounts foreclosed, and creditors knocking on her door. She contacted attorney Mali Taib, who represents debtors in insolvency and financial rehabilitation lawsuits, and in October 2022, she contacted the Tel Aviv Magistrate's Court requesting an order to initiate proceedings and protect against creditors.
In the affidavit of involvement attached to the application, A. stated that she lives off a pension, old-age pension, and survivor's pension, in a total monthly amount of approximately 10,256 shekels, and that all of her debts were incurred in good faith.
A. was admitted to the proceedings, and a trustee was appointed for her by the court.
After examining her financial situation, the insolvency officer recommended that the apartment be liquidated and sold, in order to use the proceeds from the liquidation to repay the secured debt, amounting to approximately 720,000 shekels. The recommendation meant selling the apartment where A. had lived for years, and losing her place of residence in old age, along with giving up a property that her children perceived as their childhood home and future inheritance.
And so, in parallel with the legal process, Attorney Mali Taib began negotiating with all the creditors. As part of the negotiations, agreements were reached that significantly reduced the total debt, to nearly half of its original amount.
According to Attorney Taib, without the arrangements reached at this stage, it would not have been possible to formulate a rehabilitation plan that would have allowed the apartment to be saved, and A. would have been forced to give it up.
In light of the significant reduction in debt requirements, one of A's sons volunteered to save the apartment. The son, who grew up in it and was attached to his childhood home, sought to prevent his mother from losing her place of residence and to secure her future. To this end, he took out a mortgage loan in the amount of 500,000 shekels, through which he redeemed his mother's share of the apartment.
This move made it possible to prevent the sale of the property, preserve it as a family asset and a future inheritance for him and the other siblings, and provide a significant amount to the proceeding fund without selling the apartment to a third party.
Following the redemption, only a limited debt balance remained, which was settled as part of a rehabilitation plan.
On January 4, 2026, Tel Aviv-Yafo Magistrate's Court Judge Sharon Hinda approved the agreements between the parties and gave them the force of an economic rehabilitation order.
According to the decision, A. will pay the Forgetfulness Fund an additional amount of 72,600 shekels, spread over three years in monthly payments. The remaining debt, which constitutes almost half of the total debt accumulated over the years, was canceled.
According to Attorney Mali Taib, A's case is not an isolated incident and marks a much broader phenomenon that has characterized recent years. She says that more and more elderly people in their retirement years are coming to her office when they are faced with a sudden and threatening economic crisis and may, as a result, be thrown out onto the street.
According to Attorney Taib, in A's case, all parties involved, including the trustee, the insolvency officer at the Ministry of Finance, the court, and the creditors, understood the unfortunate human case and agreed to lend their support to a humane solution that allowed for the cancellation of about half of her debt, while providing a real possibility of saving her apartment.
