Adult son racks up $20,000 on mom's cards

Dear To Her Credit,When my son (49) had bad, bad credit, I authorized him touse two accounts of mine -- a Visa and a business American Express card. I hadthe AmEx account because I was going to start a cookie business and the ratesseemed good. I never used or signed either card. I told him he could use thecards for a couple of months, and I assumed he wouldn't spend more than a fewhundred dollars.

His signature is on all of those bills. I didn't know he wasstill using them, in fact I thought I had closed the American Express. Now I find out thathe called them and had all the bills sent to him. He has run up balances ofover $20,000.

What can I do other than seeking legal help and ruining hislife? I cannot pay those bills nor do I want to hurt my credit score as Ipay the minimum or more each month, but the companies have been calling me.

I know I should not have been so generous, but he is my onlyson. -- Lenore

Dear Lenore,You have a worse problem than a $20,000 debt right now. Youhave a son who, way past the age when he should know better, is treating youdisrespectfully.

I know you had the best of intentions. We parents all wantto help our kids and to have good relationships with them. In the short term,it seemed like handing over your cards to him would accomplish both of thosethings. In the long term, it has accomplished neither. Giving a card to someonewho cannot handle money is like opening a tab for an alcoholic. And unpaiddebts between parents and children only cause more stress in relationships.

If you authorized him to use the cards, he didn't break anylaws doing so. I don't know if he had the statements sent to him because heintended to make the payments himself or to hide them from you. Either way, sorryto say, the bills are in your name.

Bankruptcy is not a good option. That amount of money is notworth going bankrupt over as it would cost you another $5,000 in fees by thetime it's over, plus repercussions to your finances for the foreseeable future.It's not your answer.

People ask a lot about negotiating debt settlements with thecredit card companies. However, despite what you've heard in someadvertisements, nobody can snap their fingers and cut your debt in half or makeit go away. Banks typically settle with debtors only in extreme hardship cases,such as catastrophic illness or unemployment. Loaning out your credit cardsto your son probably won't qualify.

The first thing you should do is close every account yourson has access to. Check your credit report and make sure he hasn't boughtanything else in your name.

Next, level with your son and tell him you cannot affordthese bills. Kids often assume their parents have unlimited money (although a49-year-old kid should know better). Tell him he is going to have to pay youback and give him suggestions on how he can do so.

He must have bought things with the $20,000. Is any of itreturnable? People who go on spending sprees often have clothes with the tagsstill on or electronics still in the box, for instance. They can go back to thestore. Used items can be sold on eBay or Craigslist. If he's enjoying thelatest sound systems and video games while you get stuck with the bills, theparty's over. I don't care if it's installed in his car -- tell him he has topay for it or sell it.

You can even offer to take items of value in lieu of cash.Does he have a motorcycle, a fishing boat or guns? He may laugh when you tellhim to hand over his toys, but this level of debt is no joke. You are perfectlycapable of turning it into cash to start paying down this debt. If he can'tpart with his stuff, maybe he will suddenly find cash.

Don't let him reduce what he owes you by claiming inflatedvalues of what he owns. People tend to overestimate what their things are worth-- often by two or three times. Check out the wholesale values yourself, oragree to only reduce the amount he owes you by the cash you get out of them.

I'm assuming that if your son is 49 years old, you must beretired. Earning enough money to pay off $20,000 would be daunting. Your son,however, is in his prime earning years. He spent the money -- he can pay itoff.

If he's already working full-time, your son might have totake an additional part-time job to pay off the debt. If there are no jobswhere he lives, he may have to start a service business of his own that doesn'trequire an investment. Depending on his skills, he can do odd jobs such asdriveway resurfacing, roof cleaning, after-school tutoring or Web site design. Essentialservices are the best bet because even in a slow economy, people still pay for them.

The bottom line is this: Your son owes you $20,000 and hehas to pay it back. It's the best thing for him, for you and for yourrelationship with him.

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