My wife agreed to vouch for her son’s rental without telling me. His car was seized for non-payment of his loan. What should I do?

We live in a community property state that also allows creditors by law to enter into pretty strong security agreements, based on everything I’ve read on the subject. In addition to not telling me about the rental agreement in advance or asking me for permission to sign the document, we found out about 48 hours later that my son-in-law had repossessed his vehicle after missing three months of payments.

The apartment in question costs $200 more per month than the one where my son-in-law currently lives. My son-in-law apparently has no credit history even though he has rented there for the past eight years, due to a “handshake” agreement with the landlord, who also happens to have been his employer during this period.

I don’t want to try to force my wife or son-in-law to ask the rental company to release her from the four-day guarantee agreement, even if they would consider doing so – which they won’t do at this point – because it would not only possibly put my son-in-law and his family on the streets, but it would cause a lot of relationship problems for my wife and me.

Can I do anything to protect our finances/assets in the worst case scenario where the rental company asks my wife to take over her rental payments? It wouldn’t necessarily damage our finances, but it would cause tremendous financial stress for both of us.

PS I should probably add that my wife is not a native English speaker, and not very good at it, and my state requires rental agents who “suspect” a potential guarantor doesn’t speak very good English to provide the agreements in their language. I would like to know if there are any ways to invalidate guarantor agreements if my stepson does not pay his rent later. At least we could fight the rental company in court to invalidate the agreement.

husband and father

Dear husband,

Two things: first, waiting for your son-in-law to default on his loan before breaking the lease would probably be considered opportunistic. Second, you and your wife should monitor your son-in-law’s finances and make sure he meets his own obligations — he shouldn’t have access to your wife’s accounts. It’s your son-in-law’s responsibility to honor this agreement, build up a credit history, and know what’s at stake if he doesn’t meet his obligations.

Most reputable lawyers will advise you to avoid legal action where possible. It is often long and expensive, and has no guarantee of success. You seem torn between finding ways to break this contract and accepting it because you don’t want to cause discord in your relationship. A lawyer could also advise you on your options and whether the language issue is actually a valid loophole in your state.

Here are some reasons why rental contracts could be invalid: essential information is missing (the duration of the rental, the deposit and the monthly rent, the presence of materials such as asbestos); the apartment is uninhabitable and does not meet city sanitation and/or building code standards; your son-in-law is called up for active military service; the terms of the lease were changed without your son-in-law’s knowledge or consent; and/or the lease contains an early termination clause.

As Joel S. Winston, trial attorney at Winston Law Firm, LLC, told Credit.com: Don’t make up reasons to get out of a lease. More often than not, they won’t work. However, certain rules apply in most states. “The habitability guarantee is accepted law in most US jurisdictions,” he said. “In some states, the guarantee has been established by decades of case law. But in other states, the warranty has been expressly established by statute.

Now is the time to sit down with your wife and son-in-law and enjoy the time together to talk about personal responsibility, budgeting, and what went wrong with the car payments – your son-in-law is he living beyond his means? — as well as putting in place a plan to avoid any non-payment of rent. Separately, talk with your wife so that such decisions are not made one-sidedly. You are, after all, a team.

There have been enough machinations behind the scenes. It’s time to talk about making financial decisions as a family and anticipating any future defaults.

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