I recently got married and neither my spouse nor I have a bank account. If we open a joint account can a lending institution freeze it because of past debts for either of us?
Let me rephrase the question. If A and B open a joint account at the 123 Bank, can that account be frozen because of debts?
If the debt is at the 123 Bank, absolutely. They would not freeze the account per se, but would setoff the money they owe you in the deposit account, to the debt that is owed them. They would likely have a contractual right to all the funds in the account, up to what is owed them.
Would the deposited funds be frozen for a debt owed to another bank or lender? They could be. This would be through a court action. Usually it means that A or B had already been sued and lost. The lender is executing a judgment via a levy or garnishment of the deposited funds. Again though, this is more of a withdrawal than a freeze. The difference being that if funds are frozen, they are still in your account. If they are actually setoff, they are withdrawn and given to the lender.
BankingQuestions.com is a free service made possible by the generous support of our advertisers. Advertisers are not responsible for site content. Please help us keep BankingQuestions.com FREE by supporting our advertisers. When you see an ad for a product or service you may have an interest in, click through to learn more.
Accounts
Article
Q&A
Podcast
Video
Blog
Discussions
PDF
Powerpoint
Let me rephrase the question. If A and B open a joint account at the 123 Bank, can that account be frozen because of debts? 