A few months before my boyfriend and I broke up, I got an offer for a zero percent deal that's good until March 2014. My boyfriend had a really high interest rate on his card, so I let him transfer that balance ($3,500) to my balance transfer card. It made sense at the time because we were living together, sharing all our expenses and planning to be engaged, so I figured it would be saving us both money in the long run.
Now, we are breaking up, and he's not talking to me, even though I have $3,500 of his debt on my card. Do I have any options? Will he get in any kind of trouble for not paying it, or is it all on me? I really do not have the money to pay this debt off because I'm only working part time, and to make matters worse, there's an annual fee that I have to pay in December on this card if it's not paid off and closed. Can I take him to court?
Had you just come to me before putting your boyfriend's debt on your credit card, I could have perhaps talked you out of it. Then you wouldn't be in this mess. But you did, and (unfortunately) he's since flown the coop. What do you do now?
Switch on your television.
No, not to take your mind off your problems, but to learn how to deal with them in court. Many small claims court programs air during the day, so take your pick and watch carefully. You'll soon see that you're hardly the first girlfriend to lend money to her sweetie, who then refuses to pay it back. Plaintiffs (the people suing) attest that they loaned the money and it was never satisfied. Defendants either argue that it was a gift, or that they've already repaid — but it was in cash, so there's no record. After hearing the testimony of both parties, the judge rules. If the plaintiff wins, a judgment is entered against the defendant and they must pay what's due. However, if they lose, the case is closed — and the money is gone.
And that is essentially what will happen if you take your ex to small claims court. It's a good venue because it's all fairly simple and you represent yourself instead of having to retain a lawyer.
Then again, I'm jumping ahead. Before taking such legal action, it would be better for everyone if you can get him to do the right thing.
Because you paid off his balance with your personal credit card, you own it. Miss a payment and your credit alone will suffer; don't pay at all and you — not he — can be
sued by the bank. Here's a plan of action:
Keep the account in good standing. You have nearly a year before interest is applied to the balance, but that's only if you pay on time. Skip a cycle, and the credit card company will probably increase the rate dramatically. You could be looking at something in the 20 percent range, so whatever you do, keep paying.
Gather hard evidence. If you have anything in writing where he admits that the amount transferred to your card was his debt, that may help your case. Stop trying to chat, and email him with the proof instead. Write something like, “Here is where you said you'd pay me back for the $3,500 credit card balance. We need to work out a plan for you to pay me back.” Document everything.
Offer reasonable resolutions. In a letter, email or text, present solutions. Maybe he has a motorcycle sitting in his garage that he can sell so he can send you the funds within a few weeks. If he has no assets or savings that you're aware of, request a payment plan that will cover the balance in far less than a year, so you're not socked with fees. For example, you might ask for $700 over five months so you'd be in the clear with time to spare. Be clear that you would like to avoid a trip to the courthouse, but if you must, you're willing to go there.
If your ex doesn't respond or refuses to pay? At that point, you'll need to make a decision: Eat the damage and consider it an expensive lesson, or sue him. If you choose the latter and you win, a judgment will appear on his credit reports and you may be able to have his wages garnished and sent to you until the debt is repaid in full.
Chances are, however, he'll want to avoid Judge Judy.
Got a question for Erica? Send her an email.