My Sister-in-Law Ran Up $12K on Our Credit Card – How Can We Recover the Money?

One of the worst things that can happen to anyone in the financial world is discovering they are the victim of fraud. It’s painful and difficult and can lead to a rollercoaster of emotions and a headache as you try to put things together, and this is doubly true if family is involved. 

This headache with family is precisely what one Redditor is going through right now with a post in r/personalfinance, as her husband’s sister was an authorized user on a credit card and, unsurprisingly, running up a very high balance without telling anyone. Unfortunately, the Redditor and her husband are now left figuring out how to handle the balance. 

The Situation 

From the Redditor’s post, we learn that the husband’s sister was added to the husband’s credit card as she was “helping pay off a balance using funds from a property she was managing for him and their mom.” If this already sounds complicated, wait as it gets even better. 

Of course, the sister promised to use the card only for this purpose, but surprise, it took her only three months before she racked up $12,000 in charges without alerting either her brother or sister-in-law. When the husband found out, he removed her from the card, but it was too late, as the damage was done. 

Currently, the couple is making the minimum payment against the balance, but they are not likely to see anything else from the sister to help. This leads us directly to their question on Reddit as to what, if anything, they can do to try and recover the money from the sister, including any legal options that might be on the table if this is what it comes to. 

The Next Step

Unfortunately, the original poster gets called out immediately for all the right reasons. This sister was an authorized credit card user, so any charges made were 100% legitimate. There is very little the credit card company would or should do to help this couple recover any money, as there is no fraud to dispute. 

First and foremost, the sister needs to be cut off from the family for good, as she essentially stole $12,000 from the couple. I don’t think it matters if the brother has a complicated relationship with the family, as this isn’t relevant anymore. The Redditor says that she can’t go into the background online, but again, it sounds like there would be more excuses for this behavior. 

As a result, there is no real action here outside of handling it on their own, and while this might be unfortunate, this is the next step. It’s just a matter of how they want to handle the balance. 

What To Do

One commenter points out all of the Redditor’s options, and it’s a pretty great comment, and I think it’s worth mentioning here: 

The first option is to transfer the balance to a zero-interest card, which is a good solution as it buys them time to pay off the balance without growing any larger. If there is money to pay off the balance, transferring it is the best move, as this is precisely what an emergency fund is for. 

Balance transfer aside, speaking with a lawyer isn’t the worst idea before taking out loans or anything similar to pay off the balance. The income the sister was receiving from this property, which she and her brother were co-managing, should also now go solely to the brother. 

Lastly, exploring a personal loan is definitely on the table, though this should be the last resort option. The good news is that the interest on a loan would be far less than the interest on a credit card (hopefully), but still, this should be the last resort. 

If this were me, I would transfer the balance to an interest-free credit card offering 0% for at least 15 to 18 months and work out how to pay off the $12,000. Yes, this could impact your budget overall, and it might mean tightening your belt for a while, but it’s better than letting this go on your credit report.