Loan/Credit Card debt after death.

[Skyline]

Hi guys, wondering if anyone can help.

My Mum died and left no will. Therefore all her bank accounts etc have been frozen. She has a loan and a credit card all with outstanding debt.

The guy in the bank advised us to look on Google for a letter which you send to the companies who you have debt with. It's meant to be really cleverly worded so the banks then have to write this debt off (they're all in her name only, no one elses name are on them).

He couldn't tell us exactly where to look as the loan is from the same company she banks with, the company he works for!

I've tried but can't find anything. Credit card company say they will claim the money from the estate (so any money we receive from her death goes to these debts). But we would rather try get these wrote off, obviously!

 

[MiloFoxburr]

Hey Sky, Sorry to hear about your Mam

Both http://www.stepchange.org/Debtinformationandadvice/Lifechanges/Bereavement.aspx and http://uk.creditcards.com/credit-card-news/credit-card-debt-after-death-1375.php seem to cover most things. You really need to speak to a Lawyer about it. They'll be able to figure out what Debts (if any) can be taken from your Mam's estate. I don't see anything online about a Letter than can make the Debts go away (and honestly I'd be surprised if one existed)

 

[Babyhack]

Hey Skyline

First off sorry mate for you lose, I can only imagine the pain you must be going through.

When you die, any debts you have must be repaid from your estate before any other claims on the estate can be met. This is the case whether or not you have made a will.
If you die and have no estate, then your debts die with you as they cannot be repaid. Your relatives are not liable for your debts unless they have provided personal guarantees for those debts.

Credit card companies are unable to collect any cash from you or other relatives to the deceased unless you were a joint account holder or co-signer.
If you were just an authorised user, meaning that you could place charges on the card but had no responsibility for payment, you are also not responsible for clearing the balance.


If the person who died had debts in their name only, you should contact the lender to notify them of the death. You should also ask them to send you a letter showing the outstanding balance of the debt.
This information will be needed by whoever is going to be dealing with the affairs of the person who has died.

Some people take out payment protection insurance (PPI) to pay off a personal loan or credit card. These policies generally only pay out in the event that someone is not able to work because of an illness or unemployment.
But it’s worth checking with the lender as some payment protection insurance includes life cover which will pay out in the event of the death of the borrower.

Ask the lenders whether any of the loan or credit card debts are covered by payment protection insurance and whether this includes life cover. If so, make a claim.

Hope some of that helps also as Milo has said ask a lawyer for some advice, it will be free and should help clear up a few things

BH

 

[Samuel]

Credit card companies are unable to collect any cash from you or other relatives to the deceased unless you were a joint account holder or co-signer.
If you were just an authorised user, meaning that you could place charges on the card but had no responsibility for payment, you are also not responsible for clearing the balance.

This applies to your own assets. Debt collectors will usually take it out of the the estate of the person who has died and If there is still an outstanding balance, then relatives are not expect to pay and it will be written off... Any assets remaining after the debt has been paid is then given to the next of kin I believe.

Edit: http://www.consumer.ftc.gov/articles/0081-debts-and-deceased-relatives

Sam

 

[Ardbeg]

Hi Skyline, again, many condolences.

Try this link. It has some easy to read info.
https://www.moneyadviceservice.org.uk/en/articles/sorting-out-someones-estate-where-to-start

Something I would say is be careful contacting some people about debts as that can mean you are acknowledging a debt exists.
Credit card companies can get stuffed as far as I'm concerned, they should be well down the list.
Local small businesses etc. are those who I would sort out first.

 

[Skyline]

Cheers guys, I'll have a read through.

I did think personally they had to just pass it onto their solicitors who then get the money through the estate. But this guy said there's a letter you can send that is wrote very cleverly.

I think we will just leave it to be done via the estate, therefore we have no worry or stress.