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Closing a joint bank account with mother


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Hello all, I have a question re: a bank account my husband shares w/his mother. My MIL has alzheimers, she lived with us for awhile and is now living with his sister. There are 3 siblings and they do not get along.

For about 2 years my husband was paying his mother's bills via a joint account they shared. These bills included mortgage, medical insurance and two life insurance policies. They were all withdrawn from this account, my husband's name was on it to keep another sibling from trying to mess with it cuz she knew he'd sue her for theft altho their mother would not.

His mom has moved in with this sister, who transferred all of their mother's monies to paper checks to be delivered to her home without telling my husband. So all of her bills hit the bank account last month, they all were paid and of course insufficient funds fees were added to the tune of $35/each.

My husband is a secondary person on this account. the bank refuses to remove his name even if we pay the overdue monies which is at about $300 now. We really can't afford that as we've been paying down our own debt. the bank says my husband would be responsible for these monies because his name is also on the account, even tho none of the bills coming in are in his name.

Is there any hope for this situation? They said they will only close the account if one of the parties die or come in to close it. The acct is in SC and his mother now lives in VA, she probably will never return to SC in thsi lifetime & even if she does she's not mentally capable of much. We don't know if the bank will continue to just accept these charges even though they clearly understnad no money is coming into the account any more.

Sorry this is so long but I hoped if I gave some background info that might help someone help us find a way out of this.

Antoher thing ... because we're married I have to assume this will also affect my credit even tho my name is not on the account, right?

Thanks for any help you can provide.

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Closing a joint account is easy. You only need one signer to close the account and remove all of the assets.

Removing one of the signers and having the account remain open in the signer's name is difficult. It requires the signature of both signers as well as the approval of the bank.

If a deposit account is overdrawn, the negative balance becomes the responsibility of both signers. If it goes unpaid, it is reported to Chex Systems and assigned or sold to a CA. At this point, it will harm his credit. It will not harm your credit as you are not a signer on the account.

The good news is that banks are lenient with payment arrangements if you are proactive in contacting them. Charged off checking accounts have a low rate of recovery and banks are willing to accept long and drawn out payment plans to recover their monies.

Is there any hope for this situation? They said they will only close the account if one of the parties die or come in to close it. The acct is in SC and his mother now lives in VA, she probably will never return to SC in thsi lifetime & even if she does she's not mentally capable of much. We don't know if the bank will continue to just accept these charges even though they clearly understnad no money is coming into the account any more.

1. Have him call the bank and ask to speak with "loss prevention" or "loss mitigation" or "deposit account loss control" (every bank calls it something different)

2. Ask to have the account charged off and closed, or "frozen" to any new charges.

3. Structure a payment plan that you can live with and be sure that the account is marked paid in full and closed.

4. Make timely payments and consider it a lesson learned.

It's that easy.

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I will have him try some of the latter options you provided. Thanks for the response.

One more question but maybe I should put this on another board. One of his mother's bills is a mortgage. One of the siblings would like to continue paying this mortgage himself, but has no bank account. The mortgage company won't stop the automatic payments to this bank acct without a letter from his mother stating the account is closed. As I said before she is incapable of much, and is inable to even sign her name anymore.

Since he technically owes the bank $300+ for overdraft fees & his mother's bills, my husband wants to not pay the money back to the bank just yet, thinking that eventually the mortgage company will stop trying to automatically deduct monies from this bank account. I'm not sure that logic will work the way he thinks it will, but I"m positive it will work against him.

Thanks again!

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Who holds the Power of Attorney for your MIL?

If that person is your husband, he can CERTAINLY sign for her on the mortgage form. And he can inform the bank that MIL no longer had the capacity or ability to sign those checks. In fact, if he had done that previously, then the bank is on the hook for those, regardless of whether her name is on the account or not.

As for the mortgage, your husband can ask that the bank not accept any debit attempts from the mortgage company again. Freezing the account will have the same effect.

If nobody has POA on your MIL, this is something that should be thought about. I understand that this is difficult when a family is not getting along, but there are a lot of concerns that, without the POA paperwork, no one is authorized to do for her. Also, who holds the medical POA (this is a seperate and often overlooked document)? That can be very important as her condition worsens. The last thing your husband wants is to have a knock-down-drag-out fight about that when she is in the hospital.

I hope everything works out well for you.

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