Will bad credit and unpaid medical bills stop you from forming an LLC? Probably not; only if your father intends to use the LLC for the fraudulent purpose of hiding from his creditors would it be a problem.
Will you be able to get a lease? That's a more complicated question, and your answer depends on the particular landlord's attitude toward risk. A new LLC's members will very likely be required to give a personal guarantee of payment of rent, and that means that the landlord may run a credit check on the guarantors of the lease (including your father). If the credit rating comes back at less than what the landlord asks for, s/he has the option to refuse to lease the premises. That, though, is a decision that rests with the individual landlord. S/He may decide that times is tough all over and go ahead and lease the space to the LLC despite your father's current unpaid medical bills.
In Schenectady County (I recognize your Zip code), there's a lot of vacant space at this point in time. Therefore, I suspect that if you tell the landlord up front, before the credit check, about the problem with unpaid medical bills, s/he will likely look more kindly on leasing you the space than s/he would if the credit problem came as a surprise. Bringing it up yourselves before the credit check also gives you the chance to explain the problem to the landlord's satisfaction.
THE INFORMATION PRESENTED HERE IS GENERAL IN NATURE AND IS NOT INTENDED, NOR SHOULD IT BE CONSTRUED, AS LEGAL ADVICE. THIS POSTING DOES NOT CREATE ANY ATTORNEY-CLIENT RELATIONSHIP BETWEEN US. FOR SPECIFIC ADVICE ABOUT YOUR PARTICULAR SITUATION, CONSULT YOUR ATTORNEY.
