Can you inherit debt? What you need to know about debt after death

Kreg Bale
Kreg Bale February 4, 2020
Updated 2020/02/04 at 3:27 PM
Can you inherit debt

It can be frustrating having your own life to deal with then getting to know you have to pay another person’s debt. I don’t think there’s anyone who would be happy to realize that. There are going to be people who will die with debts and this raises a lot of concern for their loved ones. The question now is Can you Inherit debt? If that has been running through your mind, this post is going to answer that for you.

There is no reason why you should be inheriting debts in case of death, unless you co-signed the papers for the person at that time. Paying off what the deceased owed will reduce or even take away all inheritance for survivors. People can die leaving mortgage, credit card, a loan or student debts. So, you can only inherit debt if your signature is on the contract.

Can you Inherit debt?

When a person dies, be very careful and vigilant of any creditor that brings a claim about the deceased owing them. Anyone that is in search of payment must present a request letter to the executor within six months and any claim after that will not be accepted. So many people won’t bother to file a claim with the estate but they will keep pestering family members. Unless it is a co-signed debt, you are not liable to refund any. You can contact your attorney to write a letter to stop any harassment or disturbance. However, there are some states whereby the surviving spouse can be pursued to settle debts.

The debt a person owes becomes the responsibility of their estate when they die. Estate is whatever the deceased owned at the period of death and the process of distributing and settling the bills is known as probate. There is a person called “executor of the estate” and that individual is responsible for settling the debts by using the dead person’s assets to pay them off. Creditors must make a claim within 6 months of the estate being opened or they are in for a loss. All debts are paid in a list of priorities. There is no reason why you should inherit debt that is not yours.

Can you inherit debt

A solvent estate is when the estate of the dead can pay all the bills they accumulated before dying. Furthermore, when your assets are at $40,000 and your bills are at $20,000, then you have a solvent estate because your liabilities are lesser than your assets. Then your loved ones will still have an inheritance left.

However if your liabilities are greater than your assets, then it is insolvent. All the creditors will be paid and the ones that can’t be paid will be written off. That means there would be no inheritance left for survivors.

Medical Debt

Can you inherit debt owed the hospital by a deceased person?. Medical bills are top priority on the list of debts that will be paid in case of death. However, in the case of an insolvent estate, the children of the deceased will have to inherit the debt. This can be found under the filial responsibility which imposes the duty of impoverished parents on adult children or relatives. There are so many states with that law and you need to find out how much it will be enforced in yours.

Secured Debts

Car loans or mortgages are not children’s responsibilities. Either a relative assume the debt or the property gets reclaimed by the lien holder.

It is important and advisable to always seek the advice of a lawyer before you start paying money out.

Tips to avoid inheriting debts

Can you inherit debt? If you are constantly asking yourself this question, then there are some precautions you should take to avoid being in that dilemma. Imagine still mourning a loved one and then getting the news that you need to pay up their bills. No one wants to add that to their worries. So, some of the tips you should follow are;

  • Never co-sign or get a joint debt with anyone. You will be held liable for it either in life or in death. It also means that you will continue to pay it if the borrower stops paying for any reason.
  • Avoid having supplementary credit cards on account that is not yours. If the primary holder dies, the company can hold you responsible for paying the entire balance.
  • Have an open conversation about debts with your parents or spouse if you are worried. You do not have to tell them they will die but let them be aware of situations that might arise if they keep accumulating debts without paying.
  • Learn your rights and know that you are not responsible for other people’s bills in case they pass away. You do not have to be worried if you can inherit debt or not.
  • There are so many options for you if you have a debt you want to pay back. Make sure you settle them as soon as possible. Do not let your loved ones be responsible for what will happen afterward.
Can you inherit debt
Can you inherit debt

How to Prevent Inheriting Debt

Is your loved one dead and you are not sure whether they were owing or not? If this is your problem and you want to avoid embarrassment, you can set aside money from their estate to clear their bills. If all debts are not settled and there are still assets in the estates, creditors can make a viable claim to it. So to avoid paying from your own finances, you can to this.

If you have a list of all creditors, you can send them the death certificate. Let them be aware of what is happening so that they can remove the debt from their books.


Finally, you don’t have to keep asking yourself  ” Can you inherit debt? “. This post has explained all that you need to know. Remember to always seek legal advice when you are trying to pay off the debts of the deceased.

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