Q: Are both parties responsible If a line of credit is opened by one party of a joint checking account?
My wife was added onto her mother's US Bank checking account. The intent was for my wife to be an authorized signer while my mother-in-law had surgery. Six months after my wife was added, my mother-in-law opened a line of credit and used it to pay medical expenses. My wife was not informed this line of credit was opened and certainly did not sign an authorization. My mother-in-law is now defaulting on the line of credit and the bank is coming after my wife for the outstanding balance. The line of credit also appears on my wife's credit record. US Bank indicates only one person on the joint account is required to authorize the line of credit. Is this something my wife can fight or are we obligated to pay $2,027?
A: This is something you can fight. You will need to review the terms and conditions your wife agreed to when she was added to the account. You also will need to review the terms and conditions of the agreement for the line of credit. Do not just accept the bank's oral representations to you. Look to the contracts to see what was agreed to. Even then, you can argue that your wife did not authorize the line of credit, was not a party to that agreement, and use those arguments to negotiate a release from liability, settlement, or both.
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