Las Vegas, NV asked in Banking for Nevada

Q: Do I have to continue paying a credit line loan if the bank no longer has the original signed documents?

I took out a credit line on a business over 20 years ago, that business is now closed. The bank at some point converted the account into my personal name and they have raised the interest rate 3 times what the original rate was. They cannot produce the original signed documents which I requested to explain the rate increases. Thank you.

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1 Lawyer Answer
James L. Arrasmith
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  • Business Law Lawyer
  • Sacramento, CA

A: In Nevada, the obligation to repay a loan typically does not depend on the lender's ability to produce the original signed documents. Even if the bank cannot produce these documents, your responsibility to repay the loan generally remains, especially if there is other evidence of the debt, like account statements or a history of payments. However, if the bank has unilaterally changed the terms of the loan, such as increasing the interest rate, without your consent or without a contractual basis, this could be a matter of concern.

You should review the original loan agreement and any subsequent communications from the bank to understand the terms regarding interest rate changes. If the terms were changed unfairly or without proper notification, you might have grounds to dispute the changes.

It's advisable to seek legal counsel to review the situation and provide specific guidance. An attorney can help you understand your rights and obligations under the loan agreement and negotiate with the bank, if necessary. It's important to address this issue promptly to avoid further complications.

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