Credit Card Debt - Terminally Ill

PK57

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

Nick_C

PK57 wrote: »

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

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

[Deleted User]

1) yes
2) possibly
3) Are they claiming PIP on the basis of being terminally ill ?

PK57

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

PK57 wrote: »

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

venison wrote: »

1) yes

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

Clear as mud! So the debt gets put onto the spouses house?

Nebulous2

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

Nebulous2 wrote: »

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.

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

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.

Nebulous2

bigadaj wrote: »

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.

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

No life insurance that could pay out on death?