What Happens to Someone's Credit Card Debt After They Die - morgan and morgan
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What Happens to Someone's Credit Card Debt After They Die?

What Happens to Someone's Credit Card Debt After They Die?

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What Happens to Someone's Credit Card Debt After They Die?

When someone dies, their credit card debt is paid off by any assets they own. The debt has to be paid first before their heirs or surviving spouse can receive their share of the estate. The process of paying off debt after a death varies depending on several factors. For example, the process is slightly different if the deceased has a will. 

When they die, your credit card debt doesn't die with them. Here's a more comprehensive look at different scenarios that may apply when someone dies with credit card debt.

If They Have a Will or Estate Plan

If they have a will, the executor is usually in charge of paying off the deceased’s credit card debts. An executor is an individual named in a will or estate plan to carry out the testator's wishes when they die.

The executor will prepare a list of debt accounts the testator supposedly owes. This individual will then contact the debtors to notify them about the death. After the notification, debtors can't charge extra fees or fines on the debt account in question while settling the estate. 

In most cases, the executor will be required to provide proof of death, usually a death certificate. They can also request proof of debt ownership from the debtor. 

What if the testator’s assets are insufficient to pay off the credit card debt? In that case, the credit card company might write off the debt account as a loss. This is because credit card debt is uninsured, meaning the debt collector won't have any collateral to recover. 

However, under certain circumstances, the credit card company might find it necessary to go after particular members of the testator’s family or inner circle. Here are some examples: 


If you cosigned the credit card account with the deceased, you might be responsible for the remaining balance. 

Joint Account Holders

If you were a joint credit card account holder with the deceased, you might be responsible for the debt account. 

Survivors in Community Property States

You may be responsible for the credit card debt account if you're a survivor living in a community property state. 

In community property states, spouses who acquire property during marriage own the property equally. This ownership includes debt accounts acquired during the marriage. Examples of community property states include Arizona, Idaho, Louisiana, California, Washington, New Mexico, Wisconsin, Texas, and Oklahoma. 

You may also be responsible for the deceased's credit card debt if:

  • you're their spouse, and state laws require that you pay off the debt. This usually happens with certain healthcare expenses paid for with a credit card; or
  • you were legally responsible for administering the estate, but you didn't comply with certain probate laws as required by the state. 

If They Don't Have a Will or Estate Plan

If the deceased doesn't have a Will or Estate Plan, the state will appoint someone to play the role of the executor. This individual will use the deceased's estate to pay off the outstanding debt accounts. The remaining assets will then be distributed to the surviving spouse or children. If the deceased doesn't have a spouse or children, the state divides the assets among the deceased's immediate family. 

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  • What to Do if You Inherit Credit Card Debt From the Deceased

    The loss of a loved one can drain you emotionally and mentally. Unfortunately, even as you struggle to cope with the death of your beloved, credit card companies won't stop pursuing you over the debt account. In that case, here's what you need to do:

    Create a List of the Deceased's Open Credit Card Accounts 

    Compile a list of credit card debt accounts belonging to the deceased. If you aren't sure how many credit card debt accounts the deceased left behind, you can request a copy of their credit card report. 

    Notify the Credit Company About the Death

    The credit card company needs to know that the original owner of the credit card account is dead. They may request proof of death, such as a death certificate. When the death has been confirmed, and the other party notified, they should not charge extra fees or fines on the debt account. 

    Stop Using the Credit Card 

    Stop using the credit card even if you're an authorized user. Using a credit card after the primary cardholder's death is considered fraud. 

    Notify the Consumer Credit Bureaus

    It's important to notify the consumer credit bureaus about the credit card account holder's death, even if you've already notified the credit card company. This is because criminals can take advantage of the vacuum to obtain more debt under the deceased's name. 

    More specifically, notify Experian, TransUnion, and Equifax about the death of the credit cardholder. 

    Focus on Joint Credit Card Accounts

    If you were a joint cardholder with the deceased, it's important that you keep making timely payments. This is because if you skip a payment, it will hurt your credit score. 

    However, it's also important to note that there's a difference between an authorized user and a joint account holder. If you're an authorized user on the deceased's credit card, you shouldn't make any payments on that card. 

    As an authorized user, you can make purchases using the credit card account but you're not responsible for the account balance.

    This further explains why it's illegal to make purchases with a credit card belonging to the deceased if you're an authorized user. Additionally, making payments to the deceased's credit card account as an authorized user could mean that you've assumed responsibility for the debt.

    Understand Your Rights

    Suppose you inherit the debt account after the original owner's death and don't make any payments to the account for a certain period. In that case, the credit card company will most likely contact you via mail, email, or phone calls. They'll do this in an attempt to recover the amount you supposedly owe.

    However, as the consumer, the Fair Debt Collection Practices Act protects you against some debt collection practices. Typically, the FDCPA prohibits debt collectors or credit card companies from:

    Contacting you during odd hours: Debt collection laws prohibit debt collectors from contacting you anytime before 8 a.m. and after 9 p.m. They also cannot contact you during official holidays such as Thanksgiving or Christmas. 

    Threatening you: Debt collectors cannot threaten in an attempt to recover the debt you supposedly owe. For example, they can't threaten you with jail time if you don't pay the debt. 

    Using abusive language: They can't also use abusive language to recover the debt owed. If they do, you can file a complaint. Remember not to use abusive language when responding to the credit card company. If possible, hang up the phone call and seek legal counsel. 

    Demanding more than you owe: It's illegal for credit card companies to misrepresent the amount you owe. However, despite that, debt misrepresentation happens a lot, especially in cases where one of the account holders dies. 

    It's therefore essential to ensure that you're aware of the total amount owed. If in doubt, you have the right to request debt verification. 

    Discussing your debt with third parties: The credit card company cannot discuss the debt account with your friends, colleagues, or any other authorized person. They can only discuss it with your attorney if you request them to. 

    Lying about their identity: Credit card companies or debt collectors, in general, cannot lie to you about who they are. For example, they cannot claim to be a government agency for the purposes of trying to recover what you supposedly owe. 

    Calling you if you request them to stop: You can request a credit card company or debt collector to stop calling you. For reference purposes, it's always advisable to submit such requests in writing. If the creditor continues to contact you even after you've requested them to stop, you may be able to take legal action against them. 

    Calling your workplace if your employer prohibits such phone calls: This also applies if they should've known that your employer doesn't allow such contact while you're at work.

  • Reasons to Hire a Debt Attorney if You Inherit Someone Else's Debt

    Just because you've inherited someone else's debt doesn't mean you should break the bank to pay off the debt account. In fact, you'll be surprised to find out that you don't even have to pay some of the credit card debt accounts even if you're the new owner.  

    Providing Expert Legal Advice

    Debt collection laws vary from state to state. When you're grieving the death of your loved one, the last thing you want is to be involved in endless battles with credit card companies. The truth is, some credit card companies will continue to pursue a debt account even when they know that certain laws prevent them from doing so under specific circumstances.

    For example, credit card companies cannot legally pursue a time-barred debt. If the statute of limitations for that particular debt account has expired, you don't have to pay the debt account. But such companies will continue to contact you even when they know they have no legal grounds to pursue such a debt. 

    They do this hoping that you'll agree to make a charge to the debt account, effectively restarting the statute of limitations. However, having a debt collection attorney by your side can stop the credit card company or debt collector from illegal debt collection practices. 

    Serving as Primary Point of Contact

    When grieving your loved one, the last thing you want is to deal with endless emails, mails, and phone calls from credit card companies. As mentioned earlier, you have the right to inform them to stop contacting you. 

    Alternatively, you can request that they only contact you through your attorney. Believe it or not, when credit card companies or debt collectors realize that they're dealing with a debt attorney directly, they'll most likely be more cautious with their actions. This is because they can't manipulate attorneys as they would a regular consumer. 

    Negotiating Debt Accounts

    A seasoned debt defense attorney can negotiate the debt account on your behalf. When you inherit a debt account from the deceased, chances are you'll not be able to pay the amount owed. This is especially true if you live in a community state and the deceased didn't have enough assets to pay off the debt. 

    Credit card companies understand that they can't force you to pay for something you can't afford. But despite knowing this, they'll still attempt to reach a settlement agreement with you. The problem with such agreements is that they may contain unreasonable terms, putting you into more financial problems. 

    But things are different when you have a debt defense attorney by your side. This legal representative can negotiate the debt on your behalf, ensuring that you only agree to reasonable terms. 

    In most cases, credit card companies will agree to negotiate because they know they don't have a choice, especially when you have an experienced attorney fighting for you. Debt defense attorneys understand your rights and the fact that you need to live without fear.  

    Protecting Your Assets

    As mentioned before, some credit card companies will employ different tactics hoping that you'll settle a debt account. Some will even try to convince you to pay off the credit card debt from assets protected from creditors in the event of death. 

    Examples of such assets include:

    • life insurance proceeds;
    • assets held in a living trust;
    • retirements accounts, including 401(k) plans;
    • homes (this usually depends on state law and the type of title); and
    • brokerage accounts. 

    Since attorneys are familiar with accounts and assets that shouldn't be used to settle a credit card debt, they can always protect them from credit card companies. 

    The bottom line is that a debt defense attorney is your best friend when credit card companies come after you following your loved one's death. At Morgan & Morgan, our debt defense attorneys are always a phone call away when you need someone to fight for you and protect your assets. Call us today at 877-830-2711 to talk to an expert or tell us about your case online.  

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Last updated on Dec 03, 2022

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