Watching your close ones pass away is never an easy thing. However, circumstances become even more difficult when you find out a mountain of debts left behind by your parents after they pass.
In many cases, we have received calls from harassed clients calling about abusive creditors demanding payment for their late mother’s debts. In such situations, the decisions must be taken very carefully as the clients are emotionally vulnerable and they lack a clear understanding on debt as well.
The most commonly asked question is – “My mother passed away recently. I found out about her credit card debts and personal loan. Now the debt collectors are demanding their payments from me. Is it my responsibility to pay my debts?”
In such a situation, we always hope that the answer was a straightforward “No”. But in reality, the answer is rarely monosyllabic and simple.
When is it your responsibility to pay your deceased mother’s debt?
In case you have co-signed for any of her credit accounts or bills, you can be held responsible for her lapsed payments. In any case, your mother’s estate is obligated to distribute any and all available funds to the creditors before you get the remaining accounts. In simple words, if you are a co-signer, the debt lives with you even after your mom’s death.
Added advice – don’t go around taking money out of mother’s savings accounts before her estate gets around to the legal and financial matters.
When are you NOT at all responsible for making payments on her behalf?
In most normal cases, no one can “inherit” debt. Therefore, when your mother passes, her debts die with her. You cannot be held accountable for any lapses of payments. Her creditors cannot harass you for their money. In case the calls and threats continue, you can seek legal aid to make them stop. This also applies to other relatives as well, especially in cases where you are inheriting their property.
Are there any exceptions?
There are no such exceptions in case of a parent’s death. You must remember that the estate is required, by law, to pay your late mom’s bills before you get your inheritance. In case her account does not have enough money for paying off the creditors you cannot be held responsible at all.
What is the role of the Executor?
When there’s a will, there’s an Executor. He is in-charge of putting the estate matter’s in order before the property and money passes down to the heirs. He is responsible for –
- Selling property
- Locating the estate assets
- Paying all due and overdue bills
- Distributing leftover property and money to mentioned heirs.
His main responsibility however, is to treat all the creditors fairly before disbursing any and all remaining funds.
What happens in case you fail to make payments?
In case you are a co-signer and you fail to make necessary payments you might land in serious legal issues. If you are unsure of the bills that need your attention or dues that are currently your responsibility, you should immediately talk to a probate attorney.