You might not think about all the little ways the legal system may play into your everyday life. In some cases, some small mistakes could cost you serious money.
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Ashley F. Morgan, bankruptcy and debt attorney at Ashley F. Morgan, Law PC, said there are five such mistakes to watch out for in 2025 and beyond.
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Failing To Read the Contract or Fine Print
Morgan said it’s key for consumers to remember that whether they’re signing a contract on an app or in person, the terms of the contract control any agreement. That means you need to understand exactly the terms, such as when agreeing to 0% interest over 12 months, if that means the interest is waived or deferred.
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Not Getting a Contract
This is even worse of a mistake than failing to read the contract or fine print.
“A written contract defines the terms of the agreement and can protect both parties,” Morgan noted. “While oral contracts are still valid and enforceable, if you do not have a written agreement, there can be a disagreement about what is actually agreed upon.”
Cosigning a Debt
According to Morgan, many people think of cosigning a debt as a way to vouch for someone and you’ll receive a bill if they don’t pay. But that’s not how it works — you are totally liable for those debts.
“You are agreeing to make sure those debts are paid on time, and the account can show up on your credit report, and any missed payments will also show up on your credit report,” Morgan said. “Co-signing a debt can cost you both your credit and a lot of money out of pocket.”
Not Having Enough Insurance
“Insurance is expensive these days, so it is normal to shop around,” Morgan said. “Most states have a minimum insurance amount and people will often get policies that just meet the legal requirements. However, you want to be careful about the policies being too low.”
Per Morgan, you can easily meet your insurance coverage limits if you are not careful, especially with the rising costs of cars these days. If you do not have enough coverage, you risk being liable for additional damage.
For example, if you have $25,000 in insurance coverage, but the damage to a car is $35,000 and there are medical expenses of $5,000, you could still be held liable for the $15,000 difference. Morgan also added that failing to have enough insurance and/or full pay for damages in an accident could result in loss of license in some states.
Not Signing a Prenup
According to Morgan, what people don’t realize is even if you do not sign a prenuptial agreement, you have one. It’s called state law.
“So before getting married, you need to figure out if you are having the law to control what happens if you get divorced or if you and your future spouse want to set forth terms before you tie the knot,” Morgan said. “I think way more people are ok with the idea of a prenuptial agreement if you think of it as there is already one that exists under the law, you can just choose to accept it or change it.”
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This article originally appeared on GOBankingRates.com: I’m a Lawyer: 5 Little Legal Mistakes Can Cost You Big Bucks
