Grandmother files child support fear custody

My fiance has a child from a previous relationship. The child is currently 5.

She had her in october 2006 when 17. In a couple of months she was kicked out the house by her mother. So at that time the mother advised her to let her keep the baby so the both would not be out on the streets. So when she came back the next day to visit her mother had her sign a paper that stated that the (mother has temp custody until she is mentally physically and emotionally stable to take care of her child. that she gives her mother permission to take her to all doctor and wic appts). which she sign because she didnt want to have her child in the streets. Since then she has been homeless and from house to house. When trying to see her child since that day was a hassle because her mother would find a reason not to let her see her. In 2008 we meet and got serious and she moved in with me. In 2010 She got food stamps on the advice of her mother. I was a witness to this conversation. She told her to get food stamps and the child on the application as well because she when she applied they said she made to much. we both said that would be lying and get in trouble so she threatend her by saying that if she didnt she would be able to see her child any more. so she went and applied.She had medicaid since she was pregnant with the child so was no need to apply for that as well she already had it.Since she had the foodstamps each month she would take over half the foodstamps over there. Now This year her mother wrote a letter to the Social service stating that the child was staying with her which made them cut her foodstamps off and making her pay over $1800 back. Now she has to go to court for child support on sept 5.

My fiance is worried that because of this it would make it harder to get her child back. She would like to tell the court of the mother she really had. foster parents, the harsh punishment, mother boyfriends raping her and the mother not doing anything. But we dont think that a good idea because the court might but the child in foster which would make it harder to get her back.

Our current situation is. Ive been working for 2 yrs at the same place and she has a job for 6months. we stay in a studio apt but we are currently looking for an 1 or 2 bed appt. we would like to get a 2 bed appt to get her child back.

Can you please tell us what you think about the situation. thanks.