CTB Leaving behind debt

[Sadgirldaisy]

Does anyone know how to find out whether your family would have to pay your debt when you CTB? I have medical debt and credit card debt. I don't want to leave that behind for them but I really want to CTB.

 

[DeepDespair101]

Nope. They'll likely try and contact family members but your family is not legally bound to your debt upon passing. As long as none of your family members were co-signers or anything on your cards or medical then you're good.

 

[Worndown]

If they co-signed any debt, they would need to pay it off.

 

[onceuponadec]

It depends on what country you're in, but it's pretty common around the world. I would look into the lives of your country just to check.

There are also some places where if you're married your spouse can inherit your dent.

 

[TimetoGo!]

Does anyone know how to find out whether your family would have to pay your debt when you CTB? I have medical debt and credit card debt. I don't want to leave that behind for them but I really want to CTB.

No…..they will be fine. I am in all sorts of money trouble and its the reason why my plan to CTB is near.

 

[tilly17]

Does anyone know how to find out whether your family would have to pay your debt when you CTB? I have medical debt and credit card debt. I don't want to leave that behind for them but I really want to CTB.

They usually end up
Paying your debts, it's very rare for debt collectors not to keep seeking payment. Medical and dental and all … families usually end up having to pay sue to loop
Holes and it costs more to
Fight to not pay them usually.

 

[Sadgirldaisy]

People are saying conflicting things. Does anybody have a source I could find out from? I live in Texas.

 

[DeepDespair101]

People are saying conflicting things. Does anybody have a source I could find out from? I live in Texas.

Under federal law, relatives aren't required to pay debts of the deceased. The deceased's estate will cover the debt and if there are not enough assets to cover said debt, the debt will remain unpaid. Debt collectors can still contact relatives regarding the debt but relatives are not required to pay said debt. Community state laws only apply to spouses. Texas is a community debt state but unless you have a spouse, this debt will not be passed down to anyone.
Source: am law student. Further source: this government website https://www.consumerfinance.gov/ask-cfpb/does-a-persons-debt-go-away-when-they-die-en-1463/

 

[UpandDownPrincess]

If you're married, your spouse will get hit with it.

It does not travel up (parents) or down (children) unless they co-signed for the debt. A co-signer is responsible for anything with their signature.

Your estate will be liquidated to cover the debt. Anything you own can be mandated to be sold to pay off your obligations. I can tell you, having settled a few estates, that you will be amazed at which companies will try to sell absolutely anything you have to try and get some money back. Any property of value that you give away close to your death may be recalled for sale.

Special rules for student loans:

If you have lots of student debt, make sure that whoever will get stuck processing your estate knows that the dept of education or your loan processor needs a copy of your death certificate to stop billing. It may take a few tries. They don't give up easily. Private loans may be not discharged and will go through the probate process.

If your parents have parent PLUS loans issued by the government, they will be discharged after you die. Private loans that belong to a parent will usually not be discharged if the student dies.

All of this sucks. There is quite a process to settling the estate of a loved one and it's a burden on whoever has to do it. Please have your bills organized and available, including those in collection. You can leave them in a drawer, but it's easier if people don't have to dig for them.

I'll be honest, I hate this reason for CTB. It seems to me like such a waste. Have you tried bankruptcy? It's not as bad as it seems. Just a thought. Best wishes, no matter what you decide to do.

 

[hunterfla]

Debt dies with the debtor. The only way anyone would be responsible for your personal debt is if they are a cosigner. Otherwise, a death certificate will alleviate anyone and everyone of your financial responsibilities. I literally just went through this in 2020 with my partner.

If you're married, your spouse will get hit with it.

It does not travel up (parents) or down (children) unless they co-signed for the debt. A co-signer is responsible for anything with their signature.

Your estate will be liquidated to cover the debt. Anything you own can be mandated to be sold to pay off your obligations. I can tell you, having settled a few estates, that you will be amazed at which companies will try to sell absolutely anything you have to try and get some money back. Any property of value that you give away close to your death may be recalled for sale.

Special rules for student loans:

If you have lots of student debt, make sure that whoever will get stuck processing your estate knows that the dept of education or your loan processor needs a copy of your death certificate to stop billing. It may take a few tries. They don't give up easily. Private loans may be not discharged and will go through the probate process.

If your parents have parent PLUS loans issued by the government, they will be discharged after you die. Private loans that belong to a parent will usually not be discharged if the student dies.

All of this sucks. There is quite a process to settling the estate of a loved one and it's a burden on whoever has to do it. Please have your bills organized and available, including those in collection. You can leave them in a drawer, but it's easier if people don't have to dig for them.

I'll be honest, I hate this reason for CTB. It seems to me like such a waste. Have you tried bankruptcy? It's not as bad as it seems. Just a thought. Best wishes, no matter what you decide to do.

This. I was assuming there was no "estate" or quantifiable assets.

 

[Sadgirldaisy]

If you're married, your spouse will get hit with it.

It does not travel up (parents) or down (children) unless they co-signed for the debt. A co-signer is responsible for anything with their signature.

Your estate will be liquidated to cover the debt. Anything you own can be mandated to be sold to pay off your obligations. I can tell you, having settled a few estates, that you will be amazed at which companies will try to sell absolutely anything you have to try and get some money back. Any property of value that you give away close to your death may be recalled for sale.

Special rules for student loans:

If you have lots of student debt, make sure that whoever will get stuck processing your estate knows that the dept of education or your loan processor needs a copy of your death certificate to stop billing. It may take a few tries. They don't give up easily. Private loans may be not discharged and will go through the probate process.

If your parents have parent PLUS loans issued by the government, they will be discharged after you die. Private loans that belong to a parent will usually not be discharged if the student dies.

All of this sucks. There is quite a process to settling the estate of a loved one and it's a burden on whoever has to do it. Please have your bills organized and available, including those in collection. You can leave them in a drawer, but it's easier if people don't have to dig for them.

I'll be honest, I hate this reason for CTB. It seems to me like such a waste. Have you tried bankruptcy? It's not as bad as it seems. Just a thought. Best wishes, no matter what you decide to do.

It's not the reason for my CTB, just one of the reasons I'm still here actually. I was worried about passing along my debt to my family when I die.

 

[Obliviate]

I also really need to know If I wanna go to grad school and end up CTBing would the loans just be forgiven or would my family have to pay it off cuz then I might as well not go

 

[DeepDespair101]

I also really need to know If I wanna go to grad school and end up CTBing would the loans just be forgiven or would my family have to pay it off cuz then I might as well not go

Student loans are forgiven upon death. Surprisingly, death is 1 of like 2 ways to have them forgiven. Family would just have to send a copy of the death certificate. As long as they're federal loans and your family doesn't have any parent PLUS loans, they'll be forgiven.

 

[Disaster]

People are saying conflicting things. Does anybody have a source I could find out from? I live in Texas.

People from all over the world may be speaking here about the rules in their countries, because other countries have legal systems too, and each is different. You may prefer to be more specific if you're not interested in laws in India, Norway or Israel, because I'm pretty sure each of them would be different

 

[outrider567]

People are saying conflicting things. Does anybody have a source I could find out from? I live in Texas.

No need to worry--In the US, creditors cannot go after any family members--Creditors can only make a claim against your estate, but if you die broke, they're shit out of luck

It's not the reason for my CTB, just one of the reasons I'm still here actually. I was worried about passing along my debt to my family when I die.

There is no 'passing along debt to family members' here in the US--As long as your net worth is zero, creditors get nothing and can only contact the executor of your Will---My mother died $17,000 in debt, credit card companies contacted me the executor and were satisfied that her debt was uncollectable

 

[SleepInStatic]

This is reassuring info as I still have some student debt that I have not been able to take care of. Are these laws the same in Canada? Usually the US and Canada are pretty close to each other.

 

[downndone2]

Depends on where you are located but usually it comes from your estate.

 

[ddn.ctb]

Does anyone know how to find out whether your family would have to pay your debt when you CTB? I have medical debt and credit card debt. I don't want to leave that behind for them but I really want to CTB.

If the debt is in your name and only your name will they be responsible. But if they co-signed in anyway they would be responsible for that debt