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What happens to a relative’s debts when they die?

Dealing with the death of a loved one in Tennessee can be extremely difficult. In addition to the emotional and psychological turmoil that you may go through, there are unfortunately also financial issues that must be dealt with. You may therefore be relieved to hear that, in most situations, you will not be personally responsible for debts that a relative leaves behind.

Assuming that your loved one had a will in place at the time of his or her death, all financial matters would be the responsibility of the estate, according to the Federal Trade Commission. The will should name an executor and that person then becomes the person responsible for handling any payments that are owed using the money from the estate. All of the deceased’s assets would be used to pay off any outstanding debts.

Debt collectors may still try to contact the deceased’s relatives in order to collect payment. If that happens, they should be given contact information for the executor who will then attempt to settle the debt. However, they cannot harass you or attempt to deceive you in order to collect what they are owed. If any debt remains after the all of the money in the estate has been spent, those debts usually remain unpaid.

There are a few exceptions where you may be personally liable for a loved one’s debt. If you were a co-signer on a loan or a joint owner of a credit card account, any outstanding balances will fall on you to pay. In addition, if you were name as the executor but failed to perform your duties as required by law, you may become personally liable for some or all of the deceased’s outstanding debts. Finally, some state laws do require spouses to pay certain debts, such as medical debts. This information should not be construed as legal advice and is provided as general information on this topic.

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Rothschild & Ausbrooks, PLLC
1222 16th Avenue South, Suite 12
Nashville, TN 37212

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