Legal Question in Legal Ethics in Missouri

I took out a loan for my granddaughter to purchase a small business. the max amount was $7,000. she was to make the payments on this loan.

since that time the bank sent her a credit card andd told her she could spend more than the limit. i was not contacted about this until she had charged more than $10,ooo and was having trouble making the payments. now they are saying it is a credit card account and the fees and late charges are so high she can't possibly keep up. is it legal for a bank to do this?


Asked on 8/04/10, 9:47 am

1 Answer from Attorneys
Anthony Smith LawSmith

Based upon the limited facts you provided, there seems nothing that would prevent the bank from lending your granddaughter more money than you have guarenteed, It appears that you may only be liable for $7,000 but she may be liable for all that they allege.

But, there may be limits to haw much they cna charge her for fees and interest. There were not nearly enough facts in your posting to determine if that is the case. Your granddaughter shoudl consult direclty with an attonrey who has all the facts and can ask her follow up questions. You may also choose to have an atotnrey look over the loan and guarnty documents to assess your exposure.

Good luck

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Answered on 8/17/10, 6:32 pm


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