What Happens To Your Debt In The Event Of Death ?

Its difficult enough keeping your finances in order throughout various stages in your life, particularly if your in financial difficulty and struggling to keep up with the re-payments on your debts.

But, what happens to that debt in the event of death?

When a loved one sadly passes away it can be a struggle to deal with issues that need to be decided plus finances that need to be organised.

Firstly, you need to ensure that you contact all relevant people including gas, electricity, water, telephone and mortgage/loan providers to ensure all accounts are reregistered under your sole name.

You will only be liable for the deceased debts if you have signed for them, if you have difficulty making those payments let the company know about the death of the deceased and ask for time to work out what payments you can afford now that you are gaining a sole income.

If the creditor asks you to take over the payments on a loan in the just the sole name of the deceased, you are not legally obliged to do so as this should be paid of the estate. Seek advice if you are experiencing any diffulty or just need guidance.

Any debts should be paid in full out of the estate. If there is not enough money in the estate to pay all outstanding bills or debts, funeral expenses, administration of the estate and concerning the will take priority, followed by debts that have security (such as housing loans) and lastly unsecured debts (e.g. personal loans).

Some debts may be covered by loan protection insurance in the event of death (e.g. credit union loans), be sure to find out if they do and if you can claim against them.

If you experience any financial difficulty following a breavement conatct our experienced, friendly senior debt advisors for free confidential advice on 01657 5602.