Payday loans online deal with bank accounts. The person applying for the loan must have their name on the account. If it is a joint account, one of the people listed must be the one signing for a loan. The direct payday loan company is not responsible for the communication between the joint owners of the account. Credit cards are very similar. Many couples will have an account open in one person's name and then have the partner added on as an authorized user. The other option which gets used is to open the credit card as a joint account. This latter option will make both parties responsible for a default loan.
What would a direct payday loan lender do? The person who took out the loan is the party responsible for paying off the debt. If bank accounts get closed and new ones open, the party who signed the contract is the party who must pay. Credit card companies work differently. A person, who is on an account as an authorized user, may write in and have their name taken off the account. They will not be responsible for debt which went into default. If the account was opened jointly, both parties will have collections agencies contacting them. The negative effects of the default will go against both parties' credit scores.
Collectors are doubly protected by having that option to go after both parties. Joint holders will best protect themselves by closing the account. No further charges adding to the debt is a good start. Often times, there is one partner who has better credit or a higher income to support opening new credit. Work together to pay off the debt or have it rolled over to other accounts in order to keep the collectors satisfied.
When it comes to credit card joint accounts, there are pros and cons. Include both names on the card will boost the credit of the one with a low score. It will also help get better rates on the card with both people on it. The hard part or cons come into play when one of the people on the account does not handle finances well. There have been some partners who hurt the other's credit by no controlling spending. Any time the balance is more than 30% of the available balance, the credit bureaus will rank that as a negative. Relationships problems can begin or worsen with the mismanagement of finances. Handling of the debt gets tricky if there is a separation or divorce.
Payday loans collect from the person who signed the loan. No matter what happens to the bank account or the relationship statue, online payday loan debt will stay with the person who took out the loan.
When looking for third party money, it is a good idea to look at the pros and cons from signing up to paying off. If it is your intention to increase credit scores by obtaining more debt, then payday loans are not going to help. If money is needed in order to help cover other costs, then a payday loan will work well. There are differences to each option so it is best to understand all options before making the final decision for your finances.
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