Underage debtor

roybean · 07-07-2007, 07:30 PM

I have a question for anyone who knows about Alabama law. In Alabama the legal age to sign for a credit card is 19. What happens if the underage debtor falls behind on their payments and he was 17 at the time he signed for the credit card?

I do not think that this falls under the FCRA, but rather under state contract law, correct?

Also, can they wait till the debtor is of legal age to start reporting?

centex · 07-07-2007, 08:13 PM

Was debtor upfront about their age? Things get murkier if they fudged the age...

roybean · 07-07-2007, 08:17 PM

Yes, I think the debtor was truthful on the application.

Enigma · 07-07-2007, 08:58 PM

IF the CC company was domiciled in AL this might have a bearing. If not the federal emancipated age of 18 would.

If the CC application asked for the debtors DoB, the CC issuer took a risk. How close to the debtors 18th birthday did h/she apply?

roybean · 07-07-2007, 09:15 PM

Quote:

Originally Posted by Enigma

IF the CC company was domiciled in AL this might have a bearing. If not the federal emancipated age of 18 would.

If the CC application asked for the debtors DoB, the CC issuer took a risk. How close to the debtors 18th birthday did h/she apply?

This is a national based OC, but listed with the state corporation commission in Alabama.

Enigma · 07-07-2007, 11:29 PM

Quote:

Originally Posted by roybean

This is a national based OC, but listed with the state corporation commission in Alabama.

The OC being a national CC issuer will most likely have a clause in the agreement that states the laws of XX are enforce.

Therefore, AL law may not apply.

The reason I ask if the card was applied for close to the 18th birthday, is that some courts are holding under age debtors accountable for the debt.

if it has not gone to a CA can payment arrangements be made?

roybean · 07-07-2007, 11:42 PM

Quote:

Originally Posted by Enigma

The OC being a national CC issuer will most likely have a clause in the agreement that states the laws of XX are enforce.

Therefore, AL law may not apply.

The reason I ask if the card was applied for close to the 18th birthday, is that some courts are holding under age debtors accountable for the debt.

if it has not gone to a CA can payment arrangements be made?

No mention of a CA as of yet. The OC is just reporting it. I'll see if I can get a look at the credit report.

Enigma · 07-08-2007, 12:30 AM

How much is the debt and how far behind?

Has contact been made with the OC to do a workout plan?

roybean · 07-08-2007, 12:47 AM

Debtor is now 26 and I don't know how much the debt is for. OC refuses to remove tradeline, but acknowledges that the debtor was underage. I don't know if they have asked for payment or not.

Enigma · 07-08-2007, 12:55 AM

What is the DOFD?

How is it reporting?

Lucy · 07-09-2007, 09:28 AM

If I didn't know better I could swear you were talking about my dd, Roybean. This same thing happened to her. She applied for a secured cc when she was 18, they gave her the card, I did not know anything about it. Last year she was 23 and was sued because she let it go into default, something else I didn't know about. Anyway, after finding out about this and knowing she had to go to court, I told her to argue the fact that she was underage in the state of AL when the cc was issued to her. The judge she had to go before is not for debtors and she was ruled against. She makes her last payment on the judgment Wednesday, her wages were garnished. She has ended up paying $1200.00 for a lousy $300.00 cc. Want to hear something funny though? This judge asked my dd if she was there to represent the plaintiff, she went to court dressed nicely so I don't know what the goofy judge thought.

So for your friend, tell them to hope for a judge that will listen and not make judgments before they hear everything. I don't know if there are any judges in Alabama that do that.

Enigma · 07-09-2007, 12:26 PM

Quote:

Originally Posted by Lucy

If I didn't know better I could swear you were talking about my dd, Roybean. This same thing happened to her. She applied for a secured cc when she was 18, they gave her the card, I did not know anything about it. Last year she was 23 and was sued because she let it go into default, something else I didn't know about. Anyway, after finding out about this and knowing she had to go to court, I told her to argue the fact that she was underage in the state of AL when the cc was issued to her. The judge she had to go before is not for debtors and she was ruled against. She makes her last payment on the judgment Wednesday, her wages were garnished. She has ended up paying $1200.00 for a lousy $300.00 cc. Want to hear something funny though? This judge asked my dd if she was there to represent the plaintiff, she went to court dressed nicely so I don't know what the goofy judge thought.

So for your friend, tell them to hope for a judge that will listen and not make judgments before they hear everything. I don't know if there are any judges in Alabama that do that.

How does a secured card go into default?????

jlynn · 07-09-2007, 12:59 PM

She probably didn't know enough to close it and tell them to pay off the debt with the security before it got out of control.

Lucy · 07-09-2007, 05:39 PM

I thought it was a secured card, it only had a $300.00 credit limit on it, isn't that a secured card? To me, if the cc company sets a limit, that is a secured card. All I know is she got sued for a heck of a lot more money than $300.00 after late fees and all the other crap that goes with it. If default ain't the right word and secured ain't the right word, I stand corrected.

The point I was trying to make is that here in Alabama using underage as a defense didn't seem to work, not in my county anyway.

roybean · 07-09-2007, 05:46 PM

Quote:

Originally Posted by Lucy

I thought it was a secured card, it only had a $300.00 credit limit on it, isn't that a secured card? To me, if the cc company sets a limit, that is a secured card. All I know is she got sued for a heck of a lot more money than $300.00 after late fees and all the other crap that goes with it. If default ain't the right word and secured ain't the right word, I stand corrected.

The point I was trying to make is that here in Alabama using underage as a defense didn't seem to work, not in my county anyway.

A secured card means that the debtor put up the money for a specific credit limit. Meaning they opened a savings account, made a deposit and the funds are held until the debtor establishes a good paying history.

Hedwig · 07-09-2007, 05:51 PM

Sometimes, however, you can get more limit than the funds you put up. For example, you put up $150 and get a limit of $300.