Death And Debt Collection: Are You Responsible For Your Deceased Loved One's Debts?

Posted on: 2 October 2015

Losing a loved one is a difficult and painful process, and it can be made more stressful if you have debt collectors trying to come after you for your loved one's debt. There are laws regarding collection of a deceased person's accounts, but they don't stop some companies from predatory collection. Protect yourself during this vulnerable time by knowing your rights and hiring a debt collection attorney to represent you. Here are a few points that can help you determine if you are responsible for paying the debt.

Did Your Loved One Leave Behind An Estate?

If there is an estate left behind, the debts should be paid out through the estate before any monies are disbursed to friends and relatives. In some cases, the debts may not surface until long after the estate has been distributed. This may mean that debt collection companies will attempt to go after the spouse or next of kin to settle the debts. A debt collection attorney can help you to defend yourself against this type of collection, so you can retain your share of the estate.

Do You Live In A Community Property State?

In community property states, all assets and debts are shared. If your spouse or life partner passes away, the debt then becomes yours. This doesn't mean that you can't fight the debt collectors, but it may make the battle more difficult. Your debt collection attorney will look to see if the collection agency has broken any laws while attempting to collect the debt. If this is the case, you may be able to negotiate settlement terms or have the debt expunged. Be sure to report all illegal dealings to the FTC so you can prevent other people from going through the same anguish.

Were You A Loan Cosigner?

If you cosigned a loan, lease or credit card application, the debt transfers to you after a death. You may not have been made aware that the accounts were placed in collection, so be sure to discuss this with your attorney. You may be able to reach a settlement that protects your credit rating and lowers the amount of money you'll need to pay to eliminate the debt.

After a loved one's death, contact a debt collection attorney like Sinsheimer, Stuart J if you have reason to believe you will be held accountable for the deceased's debts. You and your attorney can work as a team to reduce the amount of the debts owed or have them completely expunged, depending on your state's laws and the nature of the debt.