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FiveStarLaw
FiveStarLaw, Attorney
Category: Legal
Satisfied Customers: 36494
Experience:  25 years of experience helping people like you.
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My wife and I still work (68 and 64). Our children want to

Customer Question

My wife and I still work (68 and 64). Our children want to assist us by taking on the responsibility of managing our bills and savings. We do not object. My concern is that if we put all our income (social security, pension (small), disability income (small), and pt time pay checks) into an account that they control, what is our exposure legally and what is their's?
Submitted: 3 years ago.
Category: Legal
Expert:  FiveStarLaw replied 3 years ago.
Hello,

Thank you for your question. I will strive to provide you with legal information to assist you.

I am a lawyer with 25 years experience. Although I am not your attorney, I hope that I can give you helpful legal information on this open and nonconfidential forum.

If the income is deposited into an account in your children's name, it will be subject to the claims of your children's creditors. A better method may be to deposit the income into an account in your name and give your children power of attorney to write checks on the account.

I hope that this helps.



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FiveStarLaw, Attorney
Category: Legal
Satisfied Customers: 36494
Experience: 25 years of experience helping people like you.
FiveStarLaw and 8 other Legal Specialists are ready to help you
Customer: replied 3 years ago.

Thanks for the answer. However I need some clarrification. Perhaps I should explain further. My wife an I are going to "walk away" from our home. Because I lost my job and because we are now upside down on the house, we will walk away.

My chldren (7) have decided that they will manage all our our finances for us as we are getting older. We are both employed and have income but our health is not the best and they are trying to set things up so they can help us when one or the other is not able to continue to work. Our goal is to match our expenses with our income and remove some of the heavy burdens (interest only mortgage and car payment) that is putting us further behind.

Their idea is to set up a savings account and checking account in one of their names and to funnel all our income IN CASH into this account. Then they will pay all the bills with our monies and provide us with some cash on a monthly basis.

Please give me your opinon on this. Is it legal? It is workable? What are the potential problems?

Thanks

JRS

Expert:  FiveStarLaw replied 3 years ago.
Hello,

Thank you for your additional facts. It is not a workable solution for numerous reasons including but not limited to defraud of creditors.

Instead you may want to consider a chapter 7 bankruptcy.

I will explain.

When a property is foreclosed in New Hampshire, a judgment can be entered by the court for any amount of the loan that remains unpaid. This is called a deficiency judgment. The deficiency judgment can be used to execute on other property held by the debtor.

A Chapter 7 bankruptcy could discharge (erase) all of your unsecured debt such as the foreclosure deficiency, credit cards, judgments and personal loans. It would be an opportunity for a fresh financial start. It would allow you to keep your social security, pension, disability income, and part time pay checks.

After your chapter 7 bankruptcy is completed, you may deposit your checks to your name and list your children as power of attorney to write checks on your account.


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