Anonymous asked in Business & FinanceCredit · 1 decade ago

can credit card debt be passed on after you die?

It is my understanding that unsecured debt can not be passed on to your spouse or children when you die. I work in the credit industry and when assisting a client who's husband or wife has passed away, they usually just fax or mail a copy of the death certificate then the debt is obsolved--as long as there are no other names and/or social security numbers on the accounts of the deceased individual.

Today, I have been told that depending on the state, common laws may allow the debt to be passed on.

Is this true?

13 Answers

  • 1 decade ago
    Favorite Answer

    Who is responsible for your credit card debt after your death?

    Spouse or estate

    If the spouse is still alive, he or she is still on the hook; otherwise, the estate must pay off the creditors.


    The credit card company will first try to collect from the estate (assets will be sold to pay the bills). Then, if the account was a joint account, any survivors will be left holding the bag. If the debt belonged solely to the deceased, then the credit card company will end up eating the debt if there aren't enough assets to cover it.

    Credit counselor agrees

    I can confirm that the answer above is correct. I am a certified credit counselor and it is true that the credit card companies will try to collect from the estate first and if there is a co-signer, they will be responsible for the debt. However, if there is no estate to collect from the credit cards can not pursue collections from the family. They may try to get the family to pay the debt, but can not legally force them to. Simply mail a copy of the death certificate to the credit card company (certified mail) and they should take care of the rest.

    Inheritance laws vary

    Inheritance laws vary by state. If the state you live in (or the deceased lived in invokes "community family property" laws or "joint and several" provisions, heirs to an estate may be deemed responsible for the debts of a deceased person.

    In most cases this has nothing to do with being a relative and everything to do with being an heir. The rationale is that anyone staking claim to the assets of an estate, should also be willing to accept its liabilities.

    It depends

    That would depend on if the person is the only account holder or if the person is married and lives in a community property state. When a person dies and is the only account holder, the person's debts and assets are generally handled by the state probate court. State laws govern what property is exempted from probate procedure and what is exempt. If the deceased was married and lived in a community property state, the surviving spouse is usually responsible for most debts regardless of who held the account.

    Several possibilities

    Your estate, your spouse, a cosigner.

    ** Well Actually, after a family member passes away **

    Great Aunt died last January. A family member whom she had been staying with when she passed. Knowing that the past two mailings from them were returned, as well as knowing she had had a 0 balance before her death. Decided to place a call to the Creditor to stop the mailings. Upon opening the mailing to locate their phone number, discovered the Credit Card Company had billed her for February and March for their annual service charges of her credit card. And then also added late fees and interest on the monthly charge. The balance had been $0.00, At that time, was then somewhere around $90.00

    Family Member: "I am calling to tell you that she died in January."

    Bank: "The account was never closed and the late fees and charges still apply."

    Family Member: Oh Ok, (thinking it should have been closed already)

    Bank: "Since no payment has been made, it WILL be turned over to collections"

    Family Member: "Maybe, you should turn it over to collections then."

    Bank: "Sir, since it is two months past due, it already has been."

    Family Member: So, what will they do when they find out she is dead?"

    Bank: "Either report her account to the frauds division or report her to the credit bureau, maybe both!"

    Family Member: "Do you think God will be mad at her?"

    Bank: "Excuse me?"

    Family Member: "Did you just get what I was telling you - the part about her being dead?"

    Bank: "Sir, you'll have to speak to my supervisor."

    Supervisor gets on the phone:

    Family Member: "I'm calling to tell you, she died in January."

    Bank: "Well Sir, the account was never closed and the late fees and charges still apply."

    Family Member: "You mean you want to collect from her estate?"

    Bank: (Stammer) "Are you her lawyer?"

    Family Member: "No, I'm her great, great nephew."

    Bank: "Could you fax us a certificate of death?"

    Family Member: "Sure." Ask for the fax number to be given and sent it directly.

    Placed on HOLD for 25 minutes. Even though our machine receipted them with having received the fax before even being put on hold already...

    After they get the fax:

    Bank: "Thank you for holding, Sir, our system just isn't set up for death. I don't know what more I can do to help you."

    Family Member: "Well, if you figure it out, great! If not, you could just keep billing her. I don't think she will care."

    Bank: "Well, the late fees and charges do still apply, So were going to need her new billing address."

    Family Member: " "Name Witheld" Memorial Cemetery, Highway 129, Plot Number 001."

    Bank: "Sir, that's a cemetery!"

    Family Member: "What do you do with dead people on your planet

    Bank: "click" (Hung Up The Phone)

    That's What Really Happens *******

  • 5 years ago

    The debt cannot be passed on to the children. Any debt owed by your mother will be passed on to her estate. Since she has no estate worth anything, the debt will be considered a loss to all those she owes. This is one of the reasons credit card rates are high. They have to make up for those types of losses, so if you have a credit card and use it, you will be paying for it in a small way. You don't need to worry about this so rest easy.

  • 1 decade ago

    It is true. Also if there is any money left in your estate (depending on your state or your will) that money will first go toward paying off debt (like a credit card) before anything else.

  • 1 decade ago

    When my mother died I sent in her death certificate and all her credit card debt was cleared. This was in Toronto, Ontario. I don't know about other places.

    Also many credit cards I see have insurance which you can purchase which states in case of death they will pay off your card for you. There are even exceptions if you lose your job or become ill where they will make the payments for you.

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  • Chali
    Lv 6
    1 decade ago

    yes, it is true. Credit companies are now finding new and interesting ways to stick family members with debt that should be absolved after death. Common law in some states recognizes spousal responsibility, watch out.

  • Icon
    Lv 7
    1 decade ago

    As long as you do not pay them you can get out of it. Say if your husband dies and the card is just in his name. It that happens and you call the credit card company and tell him that you are not paying them. After a year the debt will be expunged. Once you make one payment on them you are assuming that debt.

  • wizjp
    Lv 7
    1 decade ago

    State specific as to how estate handles debits. IN some states, the debit has to be addressed by the executor of the estate and satisfied from the assets of the estate.

  • 1 decade ago

    Debt is not passed on , it gets attached to any estate value that the deceased had before it can be passed out according to there will.

  • 1 decade ago

    Yes, they can and once they place your estate in Probate all credits will be paid off before your estate is given the family.

    Source(s): Probate Court
  • 1 decade ago

    Yes, of course it is... Why would credit cards care if you die?? They still want their money

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