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    • PK57
    • By PK57 10th Nov 17, 6:46 PM
    • 3Posts
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    PK57
    Credit Card Debt - Terminally Ill
    • #1
    • 10th Nov 17, 6:46 PM
    Credit Card Debt - Terminally Ill 10th Nov 17 at 6:46 PM
    Hi
    A family member is terminally ill. They have unsecured credit card debt they are paying back monthly. 2 questions

    1. What would happen upon death. Will the debt transfer to their spouse
    2. What if they just stopped paying the debt now?

    Thanks
Page 1
    • Nick_C
    • By Nick_C 10th Nov 17, 6:50 PM
    • 3,011 Posts
    • 4,006 Thanks
    Nick_C
    • #2
    • 10th Nov 17, 6:50 PM
    • #2
    • 10th Nov 17, 6:50 PM
    Hi
    A family member is terminally ill. They have unsecured credit card debt they are paying back monthly. 2 questions

    1. What would happen upon death. Will the debt transfer to their spouse
    2. What if they just stopped paying the debt now?

    Thanks
    Originally posted by PK57

    1 The CC company can reclaim the debts from the estate
    2 if they stop making payments without agreement from the creditor, they could incur penalty/default charges
    • venison
    • By venison 10th Nov 17, 9:26 PM
    • 1,300 Posts
    • 1,390 Thanks
    venison
    • #3
    • 10th Nov 17, 9:26 PM
    • #3
    • 10th Nov 17, 9:26 PM
    1) yes
    2) possibly
    3) Are they claiming PIP on the basis of being terminally ill ?
    I am now a Board Guide on the Credit card board and the Loan board and Benefits board (But give me time to learn the ropes thanks).
    • PK57
    • By PK57 10th Nov 17, 9:48 PM
    • 3 Posts
    • 0 Thanks
    PK57
    • #4
    • 10th Nov 17, 9:48 PM
    • #4
    • 10th Nov 17, 9:48 PM
    Thanks for the reply

    They are claiming PIP, yes.

    Due to the terminally ill nature, they are unable to work, therefore the credit card debt burden is a big one. Are you sure it passes on to spouse?
    • Mojisola
    • By Mojisola 10th Nov 17, 9:51 PM
    • 28,545 Posts
    • 72,698 Thanks
    Mojisola
    • #5
    • 10th Nov 17, 9:51 PM
    • #5
    • 10th Nov 17, 9:51 PM
    Hi
    A family member is terminally ill. They have unsecured credit card debt they are paying back monthly. 2 questions

    1. What would happen upon death. Will the debt transfer to their spouse
    Originally posted by PK57
    1) yes
    Originally posted by venison
    No.

    If a person dies leaving assets then debts have to be repaid from those.

    If there isn't enough to cover the debts, the debts stay unpaid.

    A relative or spouse can't be forced to repay the debt.
    • PK57
    • By PK57 10th Nov 17, 10:04 PM
    • 3 Posts
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    PK57
    • #6
    • 10th Nov 17, 10:04 PM
    • #6
    • 10th Nov 17, 10:04 PM
    Clear as mud! So the debt gets put onto the spouses house?
    • Nebulous2
    • By Nebulous2 11th Nov 17, 3:02 AM
    • 1,628 Posts
    • 988 Thanks
    Nebulous2
    • #7
    • 11th Nov 17, 3:02 AM
    • #7
    • 11th Nov 17, 3:02 AM
    Debts aren't inherited. However assets / cash aren't inherited either until an estate is settled following specific rules. That involves paying off debt from the estate before passing money to someone else.

    Generally houses pass to a surviving spouse without forming part of an estate, but that depends on the nature of the property ownership. Look up "joint tenant" and "tenant in common" then work out which form of ownership the house is held under.
    • bigadaj
    • By bigadaj 11th Nov 17, 7:37 AM
    • 10,725 Posts
    • 7,014 Thanks
    bigadaj
    • #8
    • 11th Nov 17, 7:37 AM
    • #8
    • 11th Nov 17, 7:37 AM
    Debts aren't inherited. However assets / cash aren't inherited either until an estate is settled following specific rules. That involves paying off debt from the estate before passing money to someone else.

    Generally houses pass to a surviving spouse without forming part of an estate, but that depends on the nature of the property ownership. Look up "joint tenant" and "tenant in common" then work out which form of ownership the house is held under.
    Originally posted by Nebulous2
    Houses normally do form part if the estate but as you say the nature of the ownership will also be relevant.

    Credit card debt is unsecured though, so the actual size of the debt will also have some relevance. Lenders can apply for charging orders on assets if the sums are very large, which could be applied to a house.
    • Silver Queen
    • By Silver Queen 11th Nov 17, 8:40 AM
    • 158 Posts
    • 934 Thanks
    Silver Queen
    • #9
    • 11th Nov 17, 8:40 AM
    • #9
    • 11th Nov 17, 8:40 AM
    Just get a 3 printout official copy of the title deed from the land registry. If the house is held as tenants in common it will say it on there.
    Debt Totals November 17:
    350 Natwest Credit Card / Now 0 15,500 Loan from Parents 1 / Now 12,500 500 Loan from Parents 2 / 500 2,000 Overdraft Now 1,700
    • Nebulous2
    • By Nebulous2 11th Nov 17, 10:53 AM
    • 1,628 Posts
    • 988 Thanks
    Nebulous2
    Houses normally do form part if the estate but as you say the nature of the ownership will also be relevant.

    Credit card debt is unsecured though, so the actual size of the debt will also have some relevance. Lenders can apply for charging orders on assets if the sums are very large, which could be applied to a house.
    Originally posted by bigadaj
    Poor choice of words on my part.

    OP you should get advice about your own circumstances possibly from a debt charity. The credit card company may well pursue the surviving spouse and ask for details of the estate, if there is anything else of value there then they would need to be paid before any beneficiaries are. If the only asset is the house then the form of ownership will be important and you will need to know how it is held and get appropriate advice.
    • Edi81
    • By Edi81 11th Nov 17, 11:22 AM
    • 313 Posts
    • 192 Thanks
    Edi81
    No life insurance that could pay out on death?
    • chattychappy
    • By chattychappy 11th Nov 17, 11:24 AM
    • 6,402 Posts
    • 3,376 Thanks
    chattychappy
    Houses normally do form part if the estate but as you say the nature of the ownership will also be relevant.
    Originally posted by bigadaj
    True.

    However, even if the house is held as "joint tenants" and therefore passes outside of the estate, then if the estate is insolvent, creditors can make a claim against the house. It needs a court order, though, and I doubt whether CCs bother for the sake of relatively small amounts.
    • Malcnascar
    • By Malcnascar 11th Nov 17, 12:28 PM
    • 1,179 Posts
    • 1,297 Thanks
    Malcnascar
    Your family member may possibly have other assets which need to be considered. There may be pension funds and if so make sure the details are known. It is important that if there are pension funds they establish how they would be treated on death. Most are written in trust, it helps to nominate who gets the fund on death and if its the spouse they should know the fund is not part of the assets of the estate.
    • bigadaj
    • By bigadaj 11th Nov 17, 1:31 PM
    • 10,725 Posts
    • 7,014 Thanks
    bigadaj
    True.

    However, even if the house is held as "joint tenants" and therefore passes outside of the estate, then if the estate is insolvent, creditors can make a claim against the house. It needs a court order, though, and I doubt whether CCs bother for the sake of relatively small amounts.
    Originally posted by chattychappy
    I agree but we've no indication of the level of debt, if it's into the tens of thousands then a charging order might be considered, for a few thousand or less than unlikely they would bother.
    • bigadaj
    • By bigadaj 11th Nov 17, 1:32 PM
    • 10,725 Posts
    • 7,014 Thanks
    bigadaj
    Your family member may possibly have other assets which need to be considered. There may be pension funds and if so make sure the details are known. It is important that if there are pension funds they establish how they would be treated on death. Most are written in trust, it helps to nominate who gets the fund on death and if its the spouse they should know the fund is not part of the assets of the estate.
    Originally posted by Malcnascar
    It woudo be very unusual for a pension not to be held in trust, so it's very unlikely that a pension would form part of the estate.
    • Heng Leng
    • By Heng Leng 11th Nov 17, 5:46 PM
    • 4,218 Posts
    • 1,292 Thanks
    Heng Leng
    I agree but we've no indication of the level of debt, if it's into the tens of thousands then a charging order might be considered, for a few thousand or less than unlikely they would bother.
    Originally posted by bigadaj
    There is also some reputational damage if they are seen to be hounding the dying or deceased.
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