11)

Karen is working with BANK OF AMERICAN CREDIT to take out a loan of $25,000 to purchase her first vehicle, upon graduating from law school.

Karen does not have very good credit because she has not worked while she has been in law school. BANK OF AMERICAN CREDIT requires that Karen have a co-debtor for the $25,000 loan.

Karens parents, Luke and Elizabeth, agree with BANK OF AMERICAN CREDIT to be the co-debtors on Karens loan of $25,000.

Karens parents Luke and Elizabeth enter into an ORAL AGREEMENT with Bank of American Credit to be the co-debtors for Karens loan of $25,000.

After Luke and Elizabeth promise ORALLY to the bank to be Karens co-debtors on the $25,000, the bank loans Karen $25,000.

Luke and Elizabeth ORALLY agree with the bank to be co-debtors and pay for Karens loan IF Karen defaults on the loan.

As such, while the agreement is not in writing, there is an ORAL agreement between the bank and Luke and Elizabeth for Luke and Elizabeth to be co-debtors on Karens loan.

WHICH OF THE FOLLOWING IS ENTIRELY TRUE:

1. The oral contract between BANK OF AMERICAN CREDIT and Karens parents, Luke and Elizabeth, for Luke and Elizabeth to be the co-debtors on Karens loan with the bank is VOID.

2. The oral contract between BANK OF AMERICAN CREDIT and Karens parents, Luke and Elizabeth, for Luke and Elizabeth to be the co-debtors on Karens loan with the bank is VOIDABLE for the bank and Karens parents because the oral contract should have been in writing.

3. The oral contract between BANK OF AMERICAN CREDIT and Karens parents, Luke and Elizabeth, for Luke and Elizabeth to be the co-debtors on Karens loan with the bank is VALID but is UNENFORCEABLE by the Court.