The scenario is like this: boyfriend has unpaid debt (either from loansharks or the bank themselves) however he died from a terminal illness before debt collectors can get to him, but does his death automatically “erase” the unpaid debt he owes as he’s gone?
The thing is, they can’t pursue him as he’s literally dead. The contract he signed prior to death only bares his name (meaning the debt can’t be passed down to either his girlfriend or family) as he’s the only signatory listed on paper (while his family are not signatories).
Debt collectors or loansharks show up to his residence only finding out from his girlfriend that he passed away (she has his death certificate to prove it), she reiterates that his debt can’t be paid the “conventional” way as he’s no longer alive to do that.
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Legally, in the US at least, debt passes away when you do. But any assets you own first go to the debt before they go to any heirs you have.
As for the loan shark, well the mob doesn’t follow the law. They’ll do what they want.
Yes. Criminals are dangerous. Anything is possible if they decide to send a message.
So the debt doesn’t pass, otherwise you wouldn’t have to sell the assets.
That’s oversimplifying it. Suppose you have a relative who has $20,000 in unpaid bills, and $5,000 in a savings account. They pass away and leave everything to you in their will. The money in the savings account is used to pay some of the bills, but the remaining $15,000 debt does not pass on to you, or anyone else. If it was the other way around ($5,000 is debt, $20,000 in savings), you’d get $15,000.
In the US, debts of the deceased are paid out of the estate. If there isn’t enough money in the estate, the debts just go unpaid—descendants or other survivors are not responsible.
In your scenario, assuming he owned the residence, it would be sold and the debts repaid from the proceeds; likewise with any other assets he left behind.
Exactly. When my wife passed away the only thing we owned were personal items and one vehicle.
The collectors were sending demand letters for an estate of which there was none. Eventually I quit opening the letters and carried a marker with me to the mailbox. When something was sent to the estate of the address was blacked out, they had “return to sender - no estate” put on the front, and they were put in the outbox. After a few months they stopped coming.
If someone was coming to the door (didn’t happen in my case) I would simply have a page written up to hand them that states the person they are looking for is deceased and if they didn’t own anything that there was no estate. It would go on to say that they personally, along with any person’s they work with or for, as well as any subsequent agents are trespassed. If they contact you for the matter again law enforcement will be contacted. It would be handed to them and a picture of them would be taken after which the door would be closed.
The only way a family member can be held liable for a debt is if they have cosigned the debt.
I find myself thinking about this more and more as I get closer to retirement. I’m hoping that I get enough sufficient notice of my own death that I have time to close my checking/savings accounts, help liquidate any property I have that my kids don’t want, and convert as much as possible to cash. I intend to tell my family that any debt collectors that come knocking are to be told, in no uncertain terms, to fuck all the way off.
Same. I don’t own much anyway. The only thing that I am working on that will have any value will be classified as a 501c3.
In the US: a big gotcha is medical debt.
Surviving spouses are often stuck with the debt after the patient dies.
It’s one of the many reasons that when you check into a hospital they make you and your spouse sign all kinds of paperwork.
It’s usually the first thing they make you do, and why they roll out that stupid computer cart. Making sure you can and will pay (even after death) is all they really care about. Doing it right when you come in (scared and seeking help) is when they love to pounce.
Providing actual healthcare is way down the list of priorities. I’m talking about owners and admins, not providers.
Yes, it’s very predatory. Murica.
In addition, some couples will even divorce when one of them gets a terminal diagnosis, just to avoid screwing the survivor.
Wild how this is normalised. Here in the UK we’re relatively placid and docile when it comes to respective governments fucking us over, which they do with depressing regularity, but I feel that if this was to suddenly happen in our hospitals there would finally be large-scale rioting in the streets. We’d go proper French.
This situation will depend on the laws in your country. You should contact a lawyer for actual legal advice relevant to your area. However, I believe the standard is that (as stated by others) debts are paid by the estate of the deceased, and any remaining debt simply disappears.
If the bank sold the debt to a debt collection agency, the same rule applies. But these are not loan sharks. These are debt collectors.
A loan shark is, like, a mobster who loans you some money with the understanding that the collateral is “we’ll kill your family”. As criminals, loan sharks aren’t known for their propensity for following the law, and their interpretation of what happens to the debt may very well be that you owe it to them now. In this case, I suggest you find a way to pay the debt as, again, the collateral is “we’ll kill your family.”
“Then sell your wife, or your family, or something. We ain’t your idea of charity! Is that clear?” -Arthur Morgan
