Credit Cards

• Michigan law allows a joint credit card account to include a minor. In fact, the financial institution does not check the credit history of the minor. After all, most minors do not have a credit history. Minors also do not need to complete applications. An adult can do this for them. Teenagers often become joint account holders with a parent or another adult, which gives the minor full use of the credit card and also creates a credit history for the minor. A minor cannot apply for a credit card on his own; therefore, a joint account is his only option.
  
  

Checking and Savings Accounts

• In Michigan, state law allows a minor to open a deposit account without a cosignor. The law also allows a minor to hold a joint account with another individual. In most cases, joint accounts involve a minor child and a parent. Opening a joint account with a minor can bring with it some concerns. Chiefly, parents could expose their savings if they allow a minor access to that money. A minor could spend more than an adult expects, and the adult is left to deal with the financial ramifications. For this reason, the best way to open a joint account with a minor is to sign as a joint account holder for a separate account, which ensures that the minor does not have access to important funds. In a joint account, both parties can deposit and withdraw money.
  
  

Contractual Agreements

• In accordance with federal and Michigan law, minors cannot enter into contractual agreements, which means that minors cannot establish their own accounts for credit, including revolving credit and short- and long-term loans. Banks and credit card companies deny minors who try to obtain credit. Some minors lie about their age on applications, which constitutes fraud and can result in criminal punishment. Credit card companies and lenders are required to check that ages reported on credit card applications match with social security numbers.
  
  

Payment Responsibility

• When an adult serves as a cosignor for a credit card, it establishes the adult as the person legally responsible for the account. The bill will bear the name of the minor, but the adult must ensure that payments are made. The card issuer cannot sue the minor for payment on the account. Instead, collection activities will focus on the adult cosignor. For this reason, adults must ensure that minors are responsible account holders.