How to repay a credit card which was issued before 21 years of age
Problem
We stay in the state of California. My son was issued a credit card by a reputable credit card company. At that time, he was barely a kid of 18 years and was not earning by himself. My concern is how come a credit card company can issue credit card to a kid who doesn’t have any income? Whatsoever, he mindlessly used credit card, eating outside and paying his phone bills. This is not quite unnatural for an 18-year old kid. Now, he has used up all his credit balance and is now receiving collection calls. As he is not able to cope up with this situation any more, he has disclosed everything to me. I have heard from one of my knowledgeable friends that one smart solution is to opt for debt settlement. How to cope with this situation with debt settlement? Can you highlight something about the existing debt settlement laws in California? Please help me out.
Solution
Well in order to expand their business, many credit card companies went on credit card selling frenzy. They even sold credit cards to the minors having no income on their own. And, moreover there was as such no law restricting the credit card companies in issuing cards to anyone. However, a new law has been enforced in 2010, restricting the creditors to issue credit cards to minors below the age of 21, if they don’t have fixed income. Your son might have applied for the credit card before the law has been enforced. So, if you go by the law, the creditors who issued cards to your son can’t be held responsible. However, under the new law, a student below the age of 21, can’t get a credit card unless and until his/her parent, guardian or spouse co-sign or unless he/she can furnish sufficient documents proving his/her income.
Regarding your second query, yes, debt settlement can be one of the realistic solutions available to you under these circumstances. You can take the help of a professional agency to tide over this situation. The experienced professional agency will negotiate with the creditors on your behalf. After rounds of negotiations, the professional agency can substantially bring down the outstanding debts that your son owes. You can pay off the entire debt at once to get the crisis settled.
Another important thing that you have raised is that your son is receiving harassing collection calls from the creditors. Whatsoever, in all the states there are certain laws governing the activities of the collection agencies. In case the debtors send a Cease and Desist Letter and/or a Power of Attorney notifies the collection agency that a third party has been engaged for handling all communications with the creditor, the collection agency is legally bound to stop collection calls. The laws existing in the state of California, governing the activities of the collection agencies are more stringent. The law in California restricts the collection agencies as well as the original creditors from making harassing calls to the debtors.
Whatsoever, CA debt settlement can surely solve the debt crisis that your son is facing. And, since you are staying in the state of California, don’t hesitate to report if your son receives harassing calls continuously.
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