Liable for parents' debt

ceridwen

I am not up on the legal position - but I very much doubt there would be any legal liability on you for their debts. There would only be the moral liability to ensure that your parents debts were paid out of their estate - which would mean less for you and any siblings to inherit. But you would be able to face yourself in the mirror in the morning - knowing that you hadnt used the law to evade creditors being paid off FIRST from your parents estate.

Obviously it would be upsetting personally to see creditors taking what they needed to FIRST from the estate when your parents die - but I presume your conscience would dictate you dont suggest to your parents that they give you their house now in order for you to get money that rightfully belongs to those creditors.

And - yes - I would be upset personally too at the thought of some/all of an expected inheritance "going up in smoke" - but what CAN you do in conscience?

fistfullofdollars

I'm not an expert, but IIRC if there isnt enough money in the estate after someones death the debt doesnt die with them. The creditor will try and get payment from the next of kin.

I used to work for a bank and one case I was involved with (I had to deal with alot of deaths/probate in the branch - must have one of those faces!), a man was killed on his motorbike. He had no savings and used the money from his loan to buy said motorbike.

Because he had no money in any of his accounts and no payment protection his parents became liable for the debt. Don't ask my how/why I dont know! The debt ended up being passed onto a collection agency and the poor parents had to come to an arrangement. Telling the parents this was probably one of the most difficult things I have had to do in my career. I left soon after as I didnt want to work for a company who operated like this.

localhero

Unless the parents had signed as guarantors for their deceased son's borrowings they were not legally liable for their son's debt to the bank.

That's why when banks/debt collection agencies get involved, proper legal advice should be obtained. Sadly many organisations will try their luck, safe in the knowledge that many people when faced with a demand for money just assume the other party are in the right and just cough up:mad:

sammiboo

i remember when i was 17 and got my first loan (towards a car)

Ignorantly I was conned into getting the insurance because they said if anything happened to me my debt would be paid off and not passed onto my parents - idiotically i took it out :mad:

CLAPTON

ceridwen wrote: »

I am not up on the legal position - but I very much doubt there would be any legal liability on you for their debts. There would only be the moral liability to ensure that your parents debts were paid out of their estate - which would mean less for you and any siblings to inherit. But you would be able to face yourself in the mirror in the morning - knowing that you hadnt used the law to evade creditors being paid off FIRST from your parents estate.

Obviously it would be upsetting personally to see creditors taking what they needed to FIRST from the estate when your parents die - but I presume your conscience would dictate you dont suggest to your parents that they give you their house now in order for you to get money that rightfully belongs to those creditors.

And - yes - I would be upset personally too at the thought of some/all of an expected inheritance "going up in smoke" - but what CAN you do in conscience?

As you say, you are not up on the legal position and what you surmise is simply wrong. The correct position has already been given... the debt have to be paid from the estate before inheritance, that is by law not conscience.

Hardup_Hester

When my mother died, she had 2 small debts £30 on Littlewoods Catalogue & £40 on M & S credit card, on the advice of C A B I send both companies copies of the death cert & her bank statements showing there was no money in the estate, I had to pay for her funeral out of my own pocket. Both companies tried to get me to pay, M & S were particularly strident in their demands, & had people phoning me & trying to lay a guilt trip on me. It took some time before they stopped harassing me.
Hester

ceridwen

Clapton

I refer you to previous posts in this thread - ie:

by:

poppy10

rog2

to see why I wrote what I did re conscience.

(Obviously I reiterate the point - in case it didnt come over clearly enough) that I dont believe anyone could legally expect someone to pay off someone else's debts from their own money. In fact I am aware of someone whose husband had debts when he died - she quoted the legal position to these creditors and they had to back off (not sure about the morals of that case - as she had probably been the one that got him in debt in the first place - as she is a spendaholic and believes she is equally entitled to blow someone elses money as her own)

CLAPTON

what you said is and i quote

'There would only be the moral liability to ensure that your parents debts were paid out of their estate - which would mean less for you and any siblings to inherit.'

This is no so, it is a legal liability.

reformedspender

A big thank you for all the replies - you've put my mind at ease. I fully expected that, God forbid, if anything happened to my parents that we would pay their debt out of the estate but I was worried that liability went further. Parents are such a worry aren't they?

rog2

Hi RS - In the, God forbid but unfortunately inevitable, event of your parents' death, please can I advise you to take Professional Legal Advice BEFORE you start to pay your parents' debts - even if the estate looks sufficient.
I think you should have a look at the following thread, where a poster who was acting in good faith, but in ignorance of the law, started to pay off creditors, but soon found themselves embroiled in a legal nightmare:

http://forums.moneysavingexpert.com/showthread.html?t=523935

I'm not suggesting, for one moment, that this will happen in your case, but there are some good links as to the procedure that you should follow - and 'forewarned is forearmed'.