Since thousands who thought their jobs and income were secure are now facing long-term unemployment, it follows that thousands who never expected credit problems are now in trouble.

With savings depleted, many are unable to pay the monthly minimums on their credit cards and those cards may eventually go into default – causing credit scores to tumble and leading to lawsuits for collection.

What does that have to do with your children?

It affects them if at some time you added them as authorized users on your credit card or cards.

Don’t panic – they aren’t responsible for your debts unless they were co-applicants.

But the “piggyback  rule” that allowed your good credit to help them establish their own credit scores can now work against them. The activity on your credit card and your credit report will be reported under their names as well as yours – and when that activity is negative, your credit woes will lower their credit scores.

If you think you’re headed for default on your credit cards, the first thing to do is contact your credit card issuers and have your children’s names removed. In fact, if your spouse was not a co-applicant, have his or her name removed at the same time.

If you’ve already been late, they may not be willing to help you, so do this as soon as you see trouble on the horizon.

Next, your children should get copies of their own free online credit reports and see if your troubled accounts are listed. If so, they can contact the credit bureaus and challenge the debt. They’ll need to submit paperwork verifying that they are not the responsible parties on those accounts.

Aside from hurting their credit scores, the real trouble for your kids can come if your account is sold to a third party. All they’ll see is the names, not the status. So they could sue your children as well as you. Even if they saw the status, they might not care. Some of these 3^rd party collection agencies are vicious. In fact, the tactics they use are such that you and your kids could receive a notice of judgment before even knowing you’d been sued.

If your children are sued you will have a good defense. But you’ll still have to pay for an attorney and your kids will still go through a hassle.

Author: Mike Clover

CreditScoreQuick.com your resource for credit cards, credit reports and Credit News…..

Both the Federal Truth in Lending Act and the Fair Credit Billing Act offer some consumer protections. But you need to pay attention to the limitations and your own responsibilities.

Here are some of the protections and restrictions:

Theft or loss: The Federal Truth in Lending Act protects you if your credit card is lost or stolen. Even if you fail to report it right away, your maximum liability is $50. But realize that a debit card and a credit card have different rules, even though they look alike.

Even though a thief will say “credit” at the register in order to avoid entering a PIN, the theft of a debit card must be reported within 2 business days or you’re liable. So keep track of that debit card. If you don’t notice it’s gone until after 2 days have passed, a thief can empty your bank account and you’ll have no means of getting the money back.

Billing “Errors” can be accidental or intentional.

You may have ordered from a company and your package was lost in transit, a computer may have stuttered and entered a charge twice, someone could have forgotten to give you a credit for goods returned – or, unfortunately, you may have ordered from a bogus company that never intended to ship the goods.

The Fair Credit Billing Act gives you the right to dispute these “errors,” and to have your dispute taken seriously. So whatever the reason for the error, you can probably get the charges reversed, but only if you act quickly. You must send a dispute letter within 60 days of the charge appearing on your monthly credit card statement. Then the card issuer has 90 days to follow up with an investigation.

This is one reason why using a credit card when ordering from an “unknown” company is far safer than sending a check or money order.

When you contact your credit card issuer, be sure to include all the information. Your name, address, and account number; a complete description of the charge in question; and the reason why you dispute the charge.

You aren’t obligated to pay for a disputed charge unless the card issuer determines that it is valid, but if you have other charges on the same statement, be sure to pay at least the minimum.

Otherwise, someone else’s mistake will show up as a reduction in your credit score!

Author:Marte Cliff

CreditScoreQuick.com your resource for credit cards, credit reports and credit news.