Fact Pattern 28-1A
Dina asks Edie to co-sign a credit application so that she can borrow money and buy a truck from Finest Quality Motors.
-Refer to Fact Pattern 28-1A. If, after the loan agreement is signed, Dina agrees to a higher rate of interest without telling Edie, then Edie is
A) discharged from the agreement.
B) liable at the higher rate of interest.
C) liable at the lower rate of interest.
D) liable for the principal only.

Question

Fact Pattern 28-1A 
Dina asks Edie to co-sign a credit application so that she can borrow money and buy a truck from Finest Quality Motors.
-Refer to Fact Pattern 28-1A. If, after the loan agreement is signed, Dina agrees to a higher rate of interest without telling Edie, then Edie is
A) discharged from the agreement.
B) liable at the higher rate of interest.
C) liable at the lower rate of interest.
D) liable for the principal only.

Quizplus · Accepted Answer

If Dina agrees to a higher rate of interest without informing Edie, Edie is discharged from the agreement because the terms of the original agreement were altered without her consent.