One of the first steps you need to take is to get copies of the death certificate and send them to all lenders and credit bureaus to help prevent fraud from taking place on your loved ones accounts. There is usually a period of time, from two to six months, which a creditor is able to make a claim against a deceased person’s estate.
If the deceased was the only person on the card, the estate will be responsible for paying whatever is owed back. However, if there is a joint owner of the account, they may find themselves responsible for any remaining balances after their loved ones passing. If you are the executor of the estate, creditors will contact regarding outstanding payments. If you are not the executor, by federal rules, they are not allowed to contact you.
Federal loans are usually forgiven in the case of death. However, the same can’t necessarily be said for loans taken from private lenders. If someone was a co-signer on a loan, they may be responsible for the balance.
In most cases, the estate of the person who died will be responsible for paying off any medical bills. However, some states, including Utah, have what is known as Filial responsibility laws. This means that a third party, usually the adult child of a deceased parent, may be responsible for paying for these bills if the estate cannot cover it. You may want to reach out to an attorney if the estate won't cover the entirety of the medical bills.
If the car was only in the name of the deceased, the responsibility of payments will not to fall to anyone. At this point, you can either have the title moved to another person and they take over payments or the car is returned to the lender since it was the collateral for the loan. If there is a co-signer on the vehicle, they may become responsible for making monthly payments.
If there is a co-borrower on the mortgage, they may be able to take over the mortgage if they meet the credit requirements. In the event the house is left to someone, they will only inherit the title until they assume the loan. You may want to reach out to an attorney with experience in real estate if you find yourself in mortgage limbo.
While we hope this guide is helpful, remember that every situation is different. If you are preparing your will, you should hire a probate or estate attorney to help you iron out the details. If there was no will in place prior to your loved ones passing, there may be state laws in place that dictate how the estate is handled. Reach out to an attorney to help you go through all of this information.