Person Missing

-Ok, so my husband was sent home for r&r right after the holidays with only 2 weeks notice. . . he wasn’t supposed to be home until May. So we didn’t have money left.
-My neighbor offered her debit card so we could go on a trip as originally planned. This would be a ski trip though.
-Then she said that she wanted to go with us and that she would serve as a free sitter as long as we paid for her kids’ rental gear, lift tckets, lodging, and food.
-We took both of “our” vehicles, did an oil change on the 2nd vehicle, bought it a new battery, and reserved a 2 BR condo instead of 1 BR condo. . . just so that she could “get away” for a bit.
-On the trip the kids started bickering and the boy busted my son’s lip open (her son is 4″ taller and has been in tae-kwan-do for a year). She just said that my boy started it. . . which her son confessed later not to be true anyway.
-She became angry, caught the greyhound bus and left home. I was to make 2 payments and pay her off. But that was before the extra expenses that were incurred on “our” card. We missed the first payment, because we had to pay a lot of out of pocket money on that trip. And, we also paid for a sitter.
-She reported the card stolen, and I asked her not to because we could end up in jail. She said that we were wrong, that it wouldn’t go that far. . . that she just wanted her money back. (by the way, she wanted the bank AND us to pay her). She also said that we over-drew her account by $600 (not true). I said that I would be glad to pay as long as it was all on a bank statement. . . so she withdrew that accusation quickly. She soon found out it would take months for the investigation to be concluded and the $$ refunded.
- So she came to my door yesterday and said that she wanted her money paid in full ($1100), that is my husband’s WHOLE paycheck.
-She threatened that if not paid in full ASAP they would call the military police and accuse us of stealing and that he or both of us would go to jail.

First off, I do plan on paying her. . . so I don’t know why she is doing this. It is not her account anyway. . . I don’t know who’s it is, but it is not hers. She is not even a legalized citizen. Anyway, my husband is back in Iraq. . . just got extended 3 months. . . So he will be gone for 12 whole months without a break. So I am on my own with my 2 kids. . . is there any chance that this could be taken to court so we don’t get arrested. Yes I did use her card. Yes she did give me the pin. Yes I stayed under the authorized amount that she loaned us. Please help!