This is a little long, but I just don't know what to do!!

Okay so back in 2005 my dad applied for a credit card so that I could pay for my school tuition, books, etc. I required for college. So that I wouldn't have to keep asking for him to pay for everything, he added me to the account.

I also banked with at this time with a checking and savings account. Because I never saw this credit card on any of my banking statements, or online banking, I always assumed it was my solely dad's card. I was 18 at the time my dad gave me a copy of his card with my name on it, and I never really paid attention to my credit report. Everything was being paid on time anyway; I didn't think that I needed to check it (I had a separate credit card with a different bank as well).

Flash forward to 2009, where the housing market began exploding with foreclosures and bankruptcies. My parents were among the unfortunate individuals who had to file for bankruptcy. The filing went well and soon thereafter they were forgiven for their debt.

One day in late 2009, I find that I am overdrafted in my bank account and I needed to get a cash advance from my credit card with the bank. When I called customer service, they ran my credit and let me know that they would have to reduce my credit limit to the balance that I owed, and that they could not grant me the cash advance.

Not too long after I decided to run my credit report and this credit card that was used for my school expenses, showed up as late. Since I didn't know much about bankrupcties, I assumed that my dad's card would probably either (A) fall off as a BK and wouldn't affect me in such the way since I wasn't the one who filed BK or (B) be contacted  for recourse since my dad would not be able to pay---at least if I was on the account. (NOTE: I never signed any document in which I personally applied for this credit card to be a signer or account holder)

When my boyfriend and I went to go apply for an apartment (and moving out of his dad's house) in 2010, I assumed that the issue must have been taken care of because I was told that I showed up to have excellent credit for the application.

However, when I decided to buy a house at the end of last year I was told that my credit report shows up as a BK! I told the loan processor that that was my dad's BK and it wasn't me who filed. They never sought recourse from me and I never knew what ended up happening with it; they just took the BK settlement (again, I'm not sure how BKs work). 

I tried contacting them to arrange some way to get the BK removed from my report and to repay if that would help my credit. I was informed that it would definitely help my credit and that it didn't come up on my profile because I wasn't the "main signer" on that account (my dad's account). They said they would be more than happy to switch it over to my name and allow me to make payments. I was told they would send me more payment information and that it would be a fixed amount that would not accrue any more interest, penalties, and fees.

Figuring that I would be able to have my fantastic credit back, I agreed. Needless to say, I was never contacted about the information, was told just to pay at the bank, but that it would never show up on my profile. I wasn't sure why, if it was being switched to my name, it wouldn't show up on my account. So, I just waited for the mail correspondence I was told I would receive. 

One week later, my dad, a representative, and myself all had e-mail correspondences. My dad told the rep. that it was illegal to try to collect the debt because it was his and I was not responsible for it. The rep. told him that they were not trying to collect the debt from him.

After that we never got a response from the individual again. I never received anything. So I never ended up making that first "payment."

I ran my credit again a couple months later and found that it still showed up as a BK! So I contacted them again and told them that the BK was not mine. If they were to run my credit, there would be no other accounts that have BK. They realized this and they said they would change it to a "charge off" but that I am required to pay the amount because the account was under my name, the (new) account holder.

Unsure what that meant, I was able to get the BK off of my report and was told that this is the only way that I could get my credit score to improve. 

Since then I have been making monthly payments and was told that I could pay anywhere from $100 to $150 as long as I was making payments it would make my score look better. I have been making $100 payments assuming that this would be ok.

But, when my new loan processor went to run my credit, he said that my report shows that this account says that it is "Delinquent over 120 days."

At this point, I'm not sure what I'm doing and I just don't understand what is happening.

This last week I have called the collections department and asked them if there was anything that I could do to change the status and was told that I could pay the balance but it would always stay the same. I asked, if I were to pay it off now (assuming I could), would that help anything? I was told, "No, this is your financial responsibility so there is nothing that you could do about it." 

I hate that my credit is looking so horrible for something I would have never let go had they had just contacted me for recourse.

Can anyone help me with this situation? Is there something else I should be doing? Should I try to sue or is it a hopeless effort? (I really feel hopeless right now.)

Help, please?

Anyone.

If you were not legally required to pay a debt you did not sign for but the lender talked you into paying it the lender may be quite happy--and if you somehow later agreed to pay for it then you may be stuck as to having agreed  The lender is probably free to tell you any sort of tale to get you to pay.  Your credit rating won't put bread on the table so I might not pay a dubious debt to clean up a mere score.

Its not clear if you have a legal duty to pay the debt.

First thing you have to understand is that you don't have to sign a contract to have a contract.

It's likely that your Dad made you an authorized user of the credit card. If that was the case then you were never obligated to the debt until you agreed to be obligated to it.

Unfortunately, because your name was on the account, the discharge of the debt in bankruptcy was accurately reported on your credit report because your name was on the account even though it wasn't your bankruptcy.

Once you agreed to switch the account to your name (even over the phone) it became your account and the balance owed became your balance owed.

By obligating yourself to the balance you induced the creditor to take the bankruptcy entry off your credit report (hope you checked all three credit bureaus).

Also unfortunately, that still leaves the unpaid balance which will always be shown as more than 120 days past due until you pay off the entire balance. Then the entry is likely to change to something like "was 120 days past due, now paid."

Really nothing you can do about all this at this point. 120 days past due is nowhere near as negative as a bankruptcy on your credit reports, so you are ahead of the game.

adjuster jack:

Unfortunately, because your name was on the account, the discharge of the debt in bankruptcy was accurately reported on your credit report because your name was on the account even though it wasn't your bankruptcy.

That's not correct. If she was not the one who filed bankruptcy, then the bankruptcy notation on the credit report is wrong and the lender's failure to correct it when asked may be a violation of the federal Fair Credit Reporting Act for which the OP might be able to sue for damages.

adjuster jack:

First thing you have to understand is that you don't have to sign a contract to have a contract.

True for many types of contracts, but not all. For contracts to guarantee or pay the debt of another, typically a writing is required, signed by the person guranteeing or assuming the debt. Thus, a writing may indeed have been required here.

Taxagent, do you have any suggestions on how I should or could proceed?