Credit Card Tips

[Jones4life]

My dad and my mum have credit cards. I will soon have one

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What Are the Rules Regarding Joint Credit Card Debt?


It is vital to know the rules that pertain to joint credit card debt due to the implications they can have on long-term credit scores. Joint credit card debt is common in today's society but few people understand all of the rules that govern this type of credit card debt. It is important to understand who is responsible for what, and who the creditor can legally contact regarding the debt and hold liable.

Joint debt

Joint debt is common with credit card holders because of the benefits of having two people listed on an account. Having more than one person listed on an account typically allows for a lower interest rate and a larger credit limit. Creditors will extend these more favorable rates and limits to joint debtors because both signers can be and will be held responsible for the debt. It makes the creditor twice as likely to get money owed from the debtors. When opening an account as joint debtors, be sure to plan for all possible life events

Divorce

Joint credit card debt between a married couple going through a divorce is a common source of problems. The rules of the credit agreement state that both parties will be held responsible for the debt and it will be necessary for the attorneys involved in the proceeding to split the debts between the two individuals in a fair manner. Once the debt is decided upon, the parties should call the credit card companies, inform them of the divorce, and see how they can handle the issue. In most cases the courts will issue judgments to the parties which state which credit cards will be paid by whom. However, in the case of default, the creditor can still contact either debtor for payment. In this situation, the debtor must return to court for a motion to compel to be filed against the other debtor.

Joint debt between unmarried individuals

Joint credit card debt between unmarried individuals can be dangerous. If a girlfriend and boyfriend take out a credit card together then break up, the debt stays intact and both parties are obligated to pay for all balances old and new. Call the credit card company, cancel the card for any future transactions, and work out a plan to pay off old balances.

Keywords: Money, finance, banks, saving, invest, mutual fund, ATM, credit card, Joint Credit Card Debt