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Advice on using credit cards that are in someone else's name

Mark Cappel
UpdatedApr 8, 2024

I have $50,000 of credit card debt in my mothers name and cannot make the payments. What will happen now? Please Help!

Hi, I have about 50,000 worth of credit card debt that is in my mothers name. She took out an unsecured loan for 26,000 and she got me a some credit cards with a balance of about 23,000. I have hit a financial roadblock and can't make the payments. I do not know what to do. She knows I am having a hard time but she can't pay them either. I tried to make arrangements with the companies but their payments are still to high. What do I do? Please help me!!! What will happen if I don't pay these? Will they sue her? AGAIN PLEASE HELP!

Although you have been using these credit cards, they were opened by your mother; therefore, she is probably the only person legally liable for the debt. If you are forced to stop making regular monthly payments on the accounts, the creditors will likely try to collect the balances owed from your mother, since she is the account holder of record. I think you will understand that the issuers do not know what arrangements and side agreements were made between you and your mother as to who charged what and who was to pay the scheduled monthly payments to the banks. The issuers can only go by what their records show as to who accepted their credit offers, thereby forming credit contracts. It is this contractual relationship that makes the use of credit legitimate and enforceable by the issuer.

Collection efforts on delinquent accounts usually begin with demand letters and collection calls from the creditor directly or from third party collection agencies. While many credit card companies never escalate their collection efforts beyond this initial stage, some creditors may decide to pursue legal action against your mother in an effort to collect the balances owed. Most creditors do not sue consumers to collect on outstanding credit card accounts, as the expense of litigation often outweighs the benefits for the creditor. However, you should know that it is possible that your mother’s creditors could sue her to collect on any outstanding debt. To read more about debt collections and the various options available to consumers to resolve their debts, I encourage you to visit the debt help page.

Various options exist to assist consumers who are struggling with their monthly credit card payments. One option to consider is a Consumer Credit Counseling Service, or CCCS. CCCS companies offer numerous services, such as financial counseling and budget planning, as well as Debt Management Plans (DMP). In a DMP, the CCCS would arrange a new payment amount with each of your creditors, usually based on a reduced interest rate. You would then make a single monthly payment to the CCCS which would distribute the funds to your creditors, based on the new payment amounts. There are several drawbacks to CCCS, though. First, depending on your creditors, it may not be able to reduce monthly payments enough to improve your financial situation. Second, it may have a negative impact on your mother’s ability to obtain credit, so you and your mother may not wish to enter into a DMP if she is planning any large purchases, such as a home or auto, in the near future. Third, the average DMP takes around five years to pay off debts, so you must be willing and able to commit to a long-term repayment plan.

You may also want to consider the services offered by debt settlement firms. Rather than making monthly payments to your creditors, these programs negotiate lump sum settlements of your debts, frequently reducing your debts by 50% to 60% of your principal balances. These programs usually take only 2-3 years to complete, so this is a good option for many people to rid themselves of debt in a relatively speedy manner. In many cases they can also reduce your monthly payment toward your debt. There is one major drawback to debt settlement programs, though–they will significantly damage your mother’s credit while in the program and for at least a year or two afterwards. However, a debt settlement program is probably the fastest way to resolve these debts; once you repay the debts, your mother should be able to rebuild her credit score through careful management of her credit accounts. To read more about debt negotiation, I invite you to visit the debt negotiation page.

If you and your mother cannot afford a CCCS or debt settlement program, or if she is unwilling to take the risk of continued collection activity which can accompany such programs, your mother may wish to consider filing for bankruptcy protection. A Chapter 7 bankruptcy filing may allow your mother to discharge all unsecured debts which she owes, including these credit card accounts. If your mother is considering filing for bankruptcy protection, I would strongly encourage her to consult with a qualified bankruptcy attorney in your area to discuss the various types of bankruptcy available to consumers, and how filing bankruptcy could help resolve her debts. If you would like to read more about bankruptcy, I encourage you to visit the bankruptcy page.

You should know that you are not alone in the financial difficulties you are experiencing. Many consumers are struggling to pay their mortgage, rent, and other essential expenses, not to mention their credit card bills. Hopefully one of the options I mentioned above will help you resolve your financial difficulties. I wish you the best of luck for the future and hope that the information I have provided helps you Find. Learn. Save.



Dealing with debt

Mortgages, credit cards, student loans, personal loans, and auto loans are common types of debts. According to the NY Federal Reserve total household debt as of Q4 2023 was $17.503 trillion. Housing debt totaled $12.612 trillion and non-housing debt was $4.891 trillion.

A significant percentage of people in the US are struggling with monthly payments and about 26% of households in the United States have debt in collections. According to data gathered by from a sample of credit reports, the median debt in collections is $1,739. Credit card debt is prevalent and 3% have delinquent or derogatory card debt. The median debt in collections is $422.

The amount of debt and debt in collections vary by state. For example, in Louisiana, 37% have any kind of debt in collections and the median debt in collections is $1729. Medical debt is common and 18% have that in collections. The median medical debt in collections is $726.

While many households can comfortably pay off their debt, it is clear that many people are struggling with debt. Make sure that you analyze your situation and find the best debt payoff solutions to match your situation.