Debt when you die

If you have debt when you die, what happens to that debt?

For the most part, your debt dies with you, but that doesn’t mean it won’t affect the people you leave behind. According to an estate attorney, debt belongs to the deceased person or that person’s estate. If someone has enough assets to cover their debts, the creditors get paid, and beneficiaries receive whatever remains. But if there aren’t enough assets to satisfy debts, creditors lose out (they may get some, but not all, of what they’re owed). People often worry they will be responsible for a family member’s debt, but that usually isn’t the case. However, it’s not always that simple. The type of debt you have, where you live and the value of your estate significantly affects the complexity of the situation.

If you are a co-signor or co-applicant on an account you could be responsible for that debt. Having a good estate plan could eliminate concerns about debt when you die. 
Call for an appointment at 320-679-5183.