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. The loan originated in California. Thank you.
A:
Under California law, the enforceability of a loan generally does not depend on the physical possession of the original signed documents. If a bank cannot produce the original loan agreement, they may still be able to enforce the debt if they can prove its terms and your agreement to them through other evidence. The fact that the business has closed does not automatically negate your personal responsibility for the loan, especially if the loan was converted to your personal name.
Regarding the interest rate increases, you may have grounds to dispute these if they were not in accordance with the original agreement or any subsequent amendments you agreed to. It's advisable to review the terms of the original agreement, if available, and any related documents that govern rate changes. You may also want to consult with a lawyer to discuss your rights and potential strategies for addressing this situation. Legal advice specific to your circumstances is important, as this is a general overview and may not cover all aspects of your case.
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