Estate
After a person dies, their debts become the responsibility of the estate to settle. Estate falls under probate law and involves the distribution of assets according to the published will of the deceased. Unfortunately, the estate does not always have enough money to settle the credit card debts of the person who has passed. Depending on the circumstances behind the debt, a few different scenarios can happen.
Debt Responsibility
When the estate is unable to fully settle a credit card debt, in most cases the debt remains unpaid. According to the Federal Trade Commission, all surviving relatives usually have no liability when it comes to a loved one's debt after they have passed. In some cases, when the debt is shared by a spouse, the spouse may be liable for the debt. For example, if the credit card was a joint account with both names being represented, the surviving spouse may still be liable for the debt. Even then, it depends on specific state probate laws. An attorney can better advise you on whether or not any of the remaining credit card debts must be settled by the family.
Debt Collection
Even though a debt may be no longer valid once a death has occurred, this does not always stop collection agencies from trying to collect that debt from family members. The Fair Debt Collection Practices Act protects families from these deceptive practices, giving you specific rights when a debt collector calls to collect a debt. If a collection agency attempts to contact you, give them the number of the representative in charge of your loved one's estate. This representative is usually the executor of the will. If the collection agency continues to contact you, send a letter asking them to stop all contact with you. Make a copy for your own file, and send the letter certified mail with a return receipt. By law, they will be required to stop all contact with you once they have received the letter.
Statute of Limitations
Another issue involved with paying the credit card debts of someone who has passed away is the statute of limitations. Depending on the state, creditors may be limited to a specific amount of time after (or in some cases even before) a person has died. If this statute has passed, you may not be liable for the debt. An attorney can better advise you on the statute of limitations for your state.
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