What happens to your debt (with DCA's) when you die??

Diana_Prince

As the title suggests really!!

Does anyone else have to pay them?

What if the house is in 2 peoples names?

Broken_hearted

It comes out of your estate whether the house is in joint names or not.

boliston

These is a section on debts & estates on directgov here http://www.direct.gov.uk/en/MoneyTaxAndBenefits/ManagingDebt/DebtsAndArrears/DG_10013093 - I'm surprised that a joint property as "Joint Tenants" could also be at risk.

BINGO6572

Hi My mum has been diagnosed with a brain tumor and has been given a few months to live. Im trying to sort out finances now so we are not stressed out when grieving. Does her credit card and catalogue debt die with her? I understand the mortgage which is in a joint name with my father will leave him responsible and he will be responsible for his own debt but i am a little confused about what happens to my mums debt. i would be grateful if anyone could offer any advice or point me in the right direction.

RAS

bingo

Does you mother have any life insurance, attached to the mortgage or other wise?

With respect to other debts, if the account is in joint names, the whole debt transfers to your father.

If the account is on mum's name only, then debts are paid from her estate. If there is not enough after funeral costs, then they are paid pro rata or not at all. Creditors will try an imply that family are responsible but this is not true.

You need to find out how your parents own the house urgently. There are two types of joint ownership, joint tenancy and tenants in common.

In one case the house is owned severally and jointly by your parents, and on the death of the first parent, the other owns the house wholly. The deceased parent's "share" is never part of the estate and the transfer is automatic. Ditto regarding joint bank accounts.

In the other case, each parent owns part (usually half) of the house and when either dies that portion is part of the estate and they can leave it to who they wish in their will. In that case, any debts would be paid from the estate and the creditors could demand it from the portion of the hosue owned by the deceased.

The first scenario is more common but you need to know for sure.