Supplementary Credit Card Holders in Bankruptcy
When you apply for a credit card, you’re usually given the option to add a supplementary card for your partner or spouse.
But when your debts become unmanageable and you decide to file bankruptcy, how does it affect your supplementary card holder?
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Debt liability for a supplementary card holder
All credit card debts and transactions are the responsibility of the primary cardholder.
It doesn’t matter which card was used for the charges.
Where legal responsibility is concerned, there are different legal clauses which could be included within your credit agreement:
- The primary cardholder is solely responsible for all charges and debts incurred on both the primary and supplementary credit card;
- Both cardholders are responsible for all debts incurred on both the primary and supplementary credit card;
- The primary cardholder is responsible for debts incurred on the primary card, while the supplementary cardholder is responsible for the debts incurred on the supplementary card.
Understanding your credit card agreement
As credit card agreement terms can vary, it’s important that you understand your unique agreement fully to understand what your rights are.
You should always check the terms and conditions carefully, as you could be agreeing to interest rates or payment terms that you don’t fully understand.
It helps to have someone else look at the terms and conditions if you’re unsure about anything.
It can be easy to apply for a credit card, especially if you’ve been pre-approved.
You’ll be asked if you want to add a supplementary cardholder, which in many cases just involves adding their name.
The second cardholder will receive their own card in their name.
It’s important to understand the terms and conditions for the supplementary cardholder to establish where the responsibility lies in terms of the debt.
They could be liable for the debts that they solely incur using their own card, or have responsibility associated with all debts on the account.
However, if the supplementary cardholder can demonstrate that they didn’t apply for the card, didn’t sign for it nor use it, then they could prove that they have no responsibility for the debts incurred on the account.
Whichever option applies to you, a Licensed Insolvency Trustee could help.
By working out which category you fall into, they’ll be able to provide you with a suitable solution to tackle bankruptcy or file for a consumer proposal to help you manage your debts.
What happens to a supplementary credit card holder if I go bankrupt?
If you’re planning to file for bankruptcy, it’s important to know where your supplementary cardholder stands.
Firstly, you need to check your terms with your creditors to assess responsibility.
It’s recommended that you do this before you file a claim.
If you’re unable to access your agreement, then you should contact the credit card company to make sure you can verify the terms.
To be able to file bankruptcy, you’re going to need to consult a Licensed Insolvency Trustee.
As part of your consultation, your trustee will be able to assess your debt situation and recommend the appropriate course of action to help you deal with it.
Your trustee will be able to check the terms and conditions of your agreement on your behalf, helping you make a sensible decision regarding your spouse or partner before you make the decision to file.
Debt can affect you and your family, and it’s important to find the best solution to benefit your financial future.
By consulting with a Licensed Insolvency Trustee, you can get the advice you need to tackle your debts in a way that suits you.
Your trustee will assess your financial situation, as well as the conditions of your debts to make sure you’re doing the best thing for you and your partner or spouse.
Whether your debts are joint or individual, there are solutions out there to help you manage it.
If you’re looking for debt relief, then we’re here to help.
Get in touch with our team for a free consultation that can help you begin the journey to being debt-free.
Our friendly team is ready to take your call, so let us help you find the best debt solution for you today.
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