Oh, wow — this needs an immediate answer. Make sure they get on the phone asap and call the National Foundation for Credit Counseling. The number is 800-388-2227 — and it will automatically connect them to the nearest local office. They should set up an immediate meeting.
No fooling around about this — must do right away or they will lose any equity they have in their home. Bring their 2018 tax return (I’m hoping it is done) so the counselor can see what they are earning. Bring their check register, or print out their online bank statements so far this year. Bring ALL their current bills — and I mean ALL of those outstanding bills, car loans, mortgage statements, etc to the meeting.
And this is a lesson they have to learn the hard way — but it’s a shame that young children are involved. You don’t want them to be homeless — so stay on top of them. But, privately, be prepared that the only answer might be selling the home and moving in with you. Don’t jump to conclusions — but do INSIST on counseling right away!