Deceased Person's DebtAre you being contacted about a deceased person's debt? The last thing you need when you are mourning the death of a close loved one are calls from debt collectors demanding that you pay his past due debts. Yet, collecting the debts of the dead is a growing and lucrative market for debt collectors. In fact, some debt collectors receive training on how to talk to the bereaved and according to a New York Times article on the subject, one debt collection firm even transfers grieving relatives to a grief counselor who tries to help them cope with their emotions so that the collection firm will be more successful collecting from the bereaved relatives at a later date! Creepy, huh, and pretty outrageous too, especially considering that in most instances relatives are under no legal obligation to pay the unpaid debts of their deceased loved ones. Sadly however, many relatives do pay those debts out of a sense of obligation to the person they have lost. Here’s the facts. Generally when someone dies, the outstanding debts of the deceased are paid out of her estate during the probate process. If there is not enough money in the estate to pay all of those debts, the unpaid creditors are out of luck. In other words, they are not legally entitled to try to collect the money they are owed from the relatives of the deceased, although there are exceptions in the case of spouses. (An estate is all of the assets owned by the deceased and it’s the responsibility of the deceased’s creditors to file claims for payment from the estate with the probate court in the state where the deceased resided.) Things may work differently if your spouse dies owing money to creditors. In this instance, you could have some obligation to pay his outstanding debts depending in part on the probate law in your state. Contact a probate attorney in your area to learn about that law. Also, you will be obligated to pay any unpaid debts that are in your name as well as your spouse’s, and if you live in a community property state, you must pay any debts that your spouse incurred during your marriage, even if your name is not on the contract associated with those debts. Of course, your spouse may have left behind a large enough estate that all of those debts will get paid through the probate process. Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, and Washington State are all community property states. The federal Fair Debt Collection Practices Act protects you when you are contacted by a debt collector about a debt owed by a loved one who has passed and about any debts you may be legally obligated to pay. Your state may also have a law that protects you. If you are unclear about whether or not you are legally obligated to pay a debt owed by your deceased spouse and/or if debt collectors are contacting you demanding that you pay the debt of a relative who has died, schedule an appointment with a consumer law attorney right away.
|
