Do I Have to Pay the Credit Card Debt of My Deceased Father?
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Answer:
A deceased's debts should be paid with the property in their estate (the property left at their death). A family member doesn't typically inherit the other deceased's debts unless they created a co-signor/guarantor/surety/joint account relationship to the debt, so that the spouse's name is on the debt also, and it isn't a separate debt. Spouses will generally only be liable for a separate debt of the deceased if they live in a community proerty state. However, state laws vary about which marriage partner is responsible for certain debts depending upon when the debt was incurred, the identity of the debtor, or the purpose of the debt.
Only after the debts are paid will the remaining assets be distributed among the beneficiaries of the will. Be advised that when a beneficiary inherits property that is collateral for a debt -- for example, a car that is not paid for or a house with a mortgage -- the debt comes with the property. If there is insufficient money or assets to pay all creditors, then the estate must be divided up as equally as possible, with secured creditors receiving priority. This means that if the deceased person died with little or no money in their accounts and didn't own a home, unsecured debt, such as credit card debt will not be paid to the creditors.
When a person dies, their assets are distributed in the probate process. If a person dies with a will, an executor is named to handle the distribution of the estate. If the person dies without a will, the court appoints an administrator to distribute the decedent's assets according to the state's laws of intestacy. In cases where the decedent didn't own property valued at more than a certain amount, which varies by state, the estate may go through a small estate administration process, rather than the formal probate process. The court will issue letters testamentary or letters of administration, giving the executor or administrator authority to collect the assets, pay the debts of the decedent, and file the final tax return. In order to issue letters of administration or letters testamentary a petition to probate the estate is filed.
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