Giving credit to a friend is dangerous
Q. In 2007, my wife was trying to do a favor for a friend who was down on her luck financially. I strongly advised her against it, but she signed up for a credit card with a second user being this woman. My wife told Chase that she wanted a strict cap on the credit limit of this card set at $1,000. Chase ignored this request and the limit went up to $16,000. The woman made charges up to this amount. My question is: Is my wife liable since she strictly requested that the card be limited to $1,000?
ANONYMOUS
A. Your wife has a big heart, but you were right to advise against this act of generosity. Giving away credit is far more dangerous than giving away cash.
At stake is her credit rating and ability to get the most favorable terms, not to mention being put in this awkward situation of having a bill in her name for the charges of someone else.
Paul Hartwick, a Chase spokesman, said he could not address the specifics of this situation, but acknowledged that limits to credit can be established. “Customers may cap, reduce, or request increases to their credit limits by contacting us,’’ he said.
About your specific situation, Hartwick said: “We have been working directly with the card member herself to resolve this extremely unique issue.’’
Keeping a close eye on your credit card statements - watching them online, if possible, is a one way to spot unwelcome activity. As soon as a line was crossed you could have tried to halt it. You could also have activated an alert so you would be contacted when charges exceeded a certain amount.
Certainly, if Chase allowed a limit to be exceeded, the company bears some responsibility. But this situation was created by a good intention gone awry, so it’s good that the parties are at the table trying to work out a solution - perhaps resulting in the person who charged up the account trying to make amends for the mess she left for her friend.
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