What happens to your debt if you die?

[E equals MC2]

Totally random curiousity.

 

[Martin]

If its yours only, it dies with you. My dad's CC debt went away, but my mom still has to pay mortgage and the CCs they owned together.

 

[Bateluer]

Whatever assets you processed would be used to pay off your debts, I believe.

 

[AgaBoogaBoo]

Depends on how much debt in comparison to your assets and what they can recover, if anything. It can also vary if you're married.

 

[sixone]

Your assets and your debts pass to your estate, if you don't have a will in place.

 

[Mermaidman]

One of the great things about the USA is that your debts are not passed on to your family. Debtors, however, can make a claim against the estate.

 

[squiggledot]

I've always wondered this myself. Good to know.

 

[Rogodin2]

Personal debt is taken on by the family.

I incorporated because I don't want personal liability.

Rogo

 

[Ronstang]

Originally posted by: Rogodin2
Personal debt is taken on by the family.

I incorporated because I don't want personal liability.

Rogo

That is false. They can claim the debt against the estate of the deceased but if there are not enough assets to cover the debt it DOES NOT pass on to family members.

 

[iamwiz82]

Originally posted by: Ronstang

Originally posted by: Rogodin2
Personal debt is taken on by the family.

I incorporated because I don't want personal liability.

Rogo

That is false. They can claim the debt against the estate of the deceased but if there are not enough assets to cover the debt it DOES NOT pass on to family members.

The debtor will make it sound that way, however. The debt dies with the person, but the slimy ones will convince the family that it is theirs.

 

[her209]

So what happens if someone takes out all the equity out of their house and wills their house to a son/daughter?

 

[PhoenixOrion]

Originally posted by: Mermaidman
One of the great things about the USA is that your debts are not passed on to your family. Debtors, however, can make a claim against the estate.

 

[Ronstang]

Originally posted by: her209
So what happens if someone takes out all the equity out of their house and wills their house to a son/daughter?

In that case the family can either pay off the equity loan or the house will be sold. The equity loan becomes a lien against the house so it cannot transfer ownership until the lien is satisfied.

 

[sixone]

Originally posted by: her209
So what happens if someone takes out all the equity out of their house and wills their house to a son/daughter?

Then the son/daughter should be having a lawyer go over the deceased's loan contract on the house. There will be provisions there for just such an eventuality.

 

[DaWhim]

Originally posted by: her209
So what happens if someone takes out all the equity out of their house and wills their house to a son/daughter?

personal debt = unsecured.
mortgage = secured by an asset

 

[Rogodin2]

I'm thinking suicide-sorry.

Rogo

 

[lokiju]

They'll try and make it stick to your family.

 

[FoBoT]

unsecured debt goes away, they lose out
something like a car, the estate either has to pay it or give back the car or whatever to take care of it

 

[JohnCU]

Originally posted by: Rogodin2
I'm thinking suicide-sorry.

Rogo

if you commit suicide your debts go to family?

 

[her34]

Originally posted by: Rogodin2
I'm thinking suicide-sorry.

Rogo

interesting question. what if someone takes borrows as much as they can, gives everything away, then suicides. i think companies would have fair shot at sueing

 

[Rogodin2]

I did some research on this subject after my divorce. I found that the family is held liable for any debt that the deceased had-unless there are two years of continuous life insurance-and then the insurance will cover it.

Rogo

 

[JohnCU]

Originally posted by: Rogodin2
I did some research on this subject after my divorce. I found that the family is held liable for any debt that the deceased had-unless there are two years of continuous life insurance-and then the insurance will cover it.

Rogo

credit card debt?

 

[her34]

Originally posted by: Rogodin2
I did some research on this subject after my divorce. I found that the family is held liable for any debt that the deceased had-unless there are two years of continuous life insurance-and then the insurance will cover it.

Rogo

define family. only spouse? children? parents? siblings?

 

[Ronstang]

Originally posted by: Rogodin2
I did some research on this subject after my divorce. I found that the family is held liable for any debt that the deceased had-unless there are two years of continuous life insurance-and then the insurance will cover it.

Rogo

What country are you doing the research in? This is absolutely FALSE in the US. Like has already been said, unsecured debt disappears and secured debt gets paid off.

 

[Rogodin2]

I'm in the U.S. Can you site sources? Suicide is different from what I remember.

Rogo