Credit card debt continues to exist after you die, but typically, others are not responsible for paying it off. In most cases, your estate, or whatever money and assets you’ve left behind, will be used to pay off any debts.
Let’s explore more about what happens to credit card debt after you pass away.
When are you responsible for someone else’s credit card debt?
The only situations in which you’d usually be responsible for someone else’s debt is if you share a joint account or if you co-signed their card. In these cases, you’re still responsible for paying off debt if the cardholder dies. However, if you live in a community property state and your spouse incurred credit card debt while you were married, you may be responsible for repaying this debt.
If there’s an estate
If someone leaves behind assets (money or property) when they die, they may be used to pay off credit card debt. All debts to creditors are generally paid before an estate’s beneficiaries get their money.
An estate’s executor – whether named in a will or appointed by a probate court – is responsible for using the estate’s assets to pay off any outstanding debt. If the estate is insolvent – meaning, if the amount someone owed in debt is greater than their assets were worth, all credit card debt might not be paid.
If there’s no estate
If there is no estate, the credit card debt likely won’t be paid because there is no money to pay them.
A surviving family member can usually only be held responsible for credit card debt if they were a co-signer of the credit card account, a joint accountholder, or a spouse living in a community property state and the debt was incurred while married.
What to do after a cardholder dies
There is a lot to do after someone passes away, and it can feel overwhelming. Here are some simple financial steps you can take after a loved one dies:
- Gather financial documentation. If you’re the deceased’s spouse, executor of their estate or court-certified representative, you can request a copy of their credit report. A credit report will list all accounts in their name, which can help you track down any accounts including credit cards you may not have known about.
- Contact the credit card company. Let them know the cardholder has passed away. The credit card company communicates next steps. You may need to send a copy of the death certificate for the account to be canceled.
- Stop using the credit card. If the card has other authorized users, be sure they do not continue using it after the cardholder has died. Since a card is no longer valid after the cardholder’s death, this activity can be flagged as fraud.
- Cancel or transfer recurring payments. If the card is being used to automatically pay bills or subscriptions, cancel these or[TM[5] transfer them to another account.
- Consider contacting the credit bureaus to request a credit freeze. This will prevent anyone from opening a new account using your loved one’s name or Social Security number.
Disclosure: This article is for educational purposes. It is not intended to provide legal, investment, or financial advice and is not a substitute for professional advice. It does not indicate the availability of any Citi product or service. For advice about your specific circumstances, you should consult a qualified professional.
