Credit Owed by deceased person

mechy

Maybe a strange one this. A good friend and nieghbour lost his wife approx. 3 years ago. She had at the time £3000 owing on a credit card. Recently, my friend recieved a very threatening letter, basically saying, "Pay up or else"! Interest being added etc, etc. Can anyone please confirm, that a debt of this nature dies with the person?? ie, The bank cannot clain this debt off the surviving spouse.

The letter recieved acknowledges that the lady has died!

Thanks

normanmark

They should take the amount owing on the debt from the estate she left. Advise your friend to take a trip to his local CAB office.

olly300

Credit card companies and most banks changed their terms and conditions about 7 years ago so that if someone dies they can pursue the money from the estate of the deceased person. (I only remember because Barclaycard changed theirs and because of the number of deaths in my family I went and checked other banks/credit card companies T&C)

It's up to the deceased person's executors of any will, or if there is no will close relations, to prove that there is no money in the estate to pay the debt before the credit card company/bank will write it off. If there is money then they have to come to some arrangement to pay it.

I suggest your friend seeks free help from a legal centre or the CAB, particularly if there is no will.

DSmiffy

Hi, I'm currently going through this very situation at the moment. Dad passed away owing £3K on credit card. Mum took the card and statement to the bank who then cut up the card and we asked what happens next. The very nice assistant made a call for us to their Card Services who said they would freeze the interest (only because we asked though!)

The debt is payable out of the deceased's estate. That means any assets or insurance money from their death.

Now, my dad had no assets and no savings. They only had the house which him and mum jointly owned, which now passes to my mum. However, he had enough insurance, payable upon his death, to cover his funeral expenses and some money left over.

We told Card Services that Dad didn't have any assets who passed it to their Estate Department. They sent out a form to fill in,, which we did and sent it along with a letter stating that the only assets Dad left is any moeny left over after funeral expenses.

They are now reviewing the situation and we are waiting to see if they write it off or claim what money is left from the insurance to pay at least some of it, and then maybe write off the rest.

I will keep you posted with what happens.

Basically, if the deceased person left any assets or insurance money, then the credit card balance can be claimed from that, after funeral expenses deductions.

IMPORTANTLY....Make sure you get the interest frozen and, as long as the card is in the deceased's name only and not joint names, don't make any monthly payments. It's not your debt, it's up to them to chase it, they know that the cardholder has died, it's up to them now.

geordie_joe

DSmiffy wrote: »

Basically, if the deceased person left any assets or insurance money, then the credit card balance can be claimed from that, after funeral expenses deductions.

It's not a question of what can be claimed, it's a question of what must be paid first. If there is not enough estate to pay all debts then you have to pay them in strict order and credit card bills seem to come last on a long list.

I would not pay the credit card bill until you are sure the others on the list aren't owed anything. If you give money to a credit card company when it should have gone to the tax man, DWP or the Council Tax man then you will be in big trouble.

mechy

Many thanks for all your replies. I will pass this info onto my friend. As you have already suggested,

mechy

Many thanks for all your replies. I will pass this info onto my friend. As you have already suggested, a .to the Cab is in order I think

rab_cilbup

Similar thing happened to me, my wife passed away last year and left around 12k in credit card debts - no card protection (and am sure they would have got out of paying up anyway !) - the only asset in the estate was our flat which was actually in her sole name. Swings and roundabouts really as the mortgage was paid off in full with insurance but still left the card debt which would have come out of the estate.

As she was a civil servant I received a death in service award, so I basically paid the card debts off myself with that, there were no further claims to be satisfied against the estate and the flat was transferred into my name.

CLAPTON

DSmiffy wrote: »

Hi, I'm currently going through this very situation at the moment. Dad passed away owing £3K on credit card. Mum took the card and statement to the bank who then cut up the card and we asked what happens next. The very nice assistant made a call for us to their Card Services who said they would freeze the interest (only because we asked though!)

The debt is payable out of the deceased's estate. That means any assets or insurance money from their death.

Now, my dad had no assets and no savings. They only had the house which him and mum jointly owned, which now passes to my mum. However, he had enough insurance, payable upon his death, to cover his funeral expenses and some money left over.

We told Card Services that Dad didn't have any assets who passed it to their Estate Department. They sent out a form to fill in,, which we did and sent it along with a letter stating that the only assets Dad left is any moeny left over after funeral expenses.

They are now reviewing the situation and we are waiting to see if they write it off or claim what money is left from the insurance to pay at least some of it, and then maybe write off the rest.

I will keep you posted with what happens.

Basically, if the deceased person left any assets or insurance money, then the credit card balance can be claimed from that, after funeral expenses deductions.

IMPORTANTLY....Make sure you get the interest frozen and, as long as the card is in the deceased's name only and not joint names, don't make any monthly payments. It's not your debt, it's up to them to chase it, they know that the cardholder has died, it's up to them now.

Do bear in mind that they can legally claim from the value of his share in the house.

jonesMUFCforever

CLAPTON wrote: »

Do bear in mind that they can legally claim from the value of his share in the house.

They can put a charge on his property but cannot force him to pay up until his death when the debt might become a debt on his estate

JohalaReewi

DSmiffy wrote: »

... as long as the card is in the deceased's name only and not joint names...

A credit card will always be in one person's name. There is no joint liability on a credit card debt. Anyone else is an additional card holder and they are not liable for any of the debt. Only the main card holder is liable.