My boyfriend's father racked up around $70,000 in debt in my boyfriend's name about 15 years ago. This debt has never been paid and is very fraudulent. My boyfriend, however, does not wish to take legal action against his father. We will be moving in together at the end of the month and planned to open a joint checking account to store money for shared bills, such as the mortgage and utilities. If the account has both of our names on it, and we are not married, are creditors able to take these funds? Does it change at all if we were married?
First, I must note that we have not spoken and there are many facts that I do not know, however, there may be statutes of limitation involved, and much will depend on how you title the joint bank account, what types of debt, whether or not you can prove fraud, what your boyfriend has done in the last 15 years regarding these debts, etc. Your best option is to consult with an attorney regarding these matters. I wish you and your boyfriend the best of luck.
Answer given for general advice and is not a legal opinion, which would require an analysis of the facts and circumstances as well as the applicable law and regulations.
Yes and no depending on the facts. If a creditor gets a judgment against your boyfriend, he can have no joint accounts with anyone because a creditor can seize funds in a joint bank account, even if the parties are married, unless the funds are somehow protected (if both people got Social Security or unemployment then it would be protected). However, a creditor needs a judgment to do this and your boyfriend would have notice (in theory) of any judgments against him. I suggest that your boyfriend check all the counties in which he and his father lived for the past 15 years. I have seen clients move from one county to another only to get sued in the county where they previously lived.
Assuming there are no judgments, then creditors (if they are ordinary creditors like credit card companies) cannot just reach into a bank account in most cases. There are exceptions; creditors who are banks - for example, if you bank at Chase and have a Chase credit card and do not pay on the card Chase can go into your bank account and withdraw the funds. But if your boyfriend does not bank where he would owe money he would not worry about this.
Debts are governed by the statute of limitations. If the debts were created in PA, the the statute of limitations is 4 years. Different states have different periods of limitation, so if the debt was created elsewhere another period may apply. Even if the debt was created in PA then the credit card agreement may provide that a different limitations period would apply. Most states are between 3 and 7 years but a very few states have limitations of 15 - 20 years.
Regardless of these debts, you should not have a joint ownership of anything if you are not married. That is asking for problems if the relationship sours. You do not need a joint account to pay household bills. You can divide things up between you - like he pays the mortgage and you pay the utilities and for food or something like that.
Your boyfriend needs to pull all 3 of his credit reports; he can get a free report from each of the bureaus at www.annualcreditreport.com. He needs to review to see if there are any of these fraudulent accounts or judgments listed thereon. The credit report is not the end. Reports only have to report information for 7 1/2 years from the time the debt went delinquent or a judgment was entered. So it is possible that some of these debts may have already dropped off. That is why your boyfriend needs to check the court records for any judgments because these never go away.
Read my articles at my website: www.rachelhunterlaw.com
Below is one on what I call "Zombie" debts. These are debts that are barred by the statute of limitation but which, like zombies, still come back to life even though they are suppposed to be dead.