When a resident of North Carolina dies, his outstanding credit card debt becomes a matter for his estate executor to manage. The executor either pays the debt out of the debtor's estate or notifies the credit card companies the estate does not have the funds to satisfy the debt. Spouses are not responsible for repaying the credit card debt of the deceased, unless the spouse was a joint holder of the credit card account.
Duties of Executors and Administrators
After a person dies in North Carolina, the executor or administrator of her estate is responsible for gathering information about her debts and assets. An executor or administrator must place an ad in the legal notices section of a newspaper informing creditors of her death and instructing all creditors to contact the executor or administrator to make a claim for debt payment from the estate The executor or administrator must pay all debts out of the deceased's estate before he can distribute any assets to the decedent's heirs.
Credit Card Debt Priority
North Carolina law requires executors and administrators to prioritize the deceased's debt for repayment. If the deceased's assets do not cover her debts, the executor or administrator must repay the debt in accordance with North Carolina's "Order Of Priority Of Claims." Credit card debt has the lowest priority under this rule, and other debts such as funeral expenses, employee wages and taxes are paid first. If the estate isn't large enough to cover the credit card debt, the credit card company won't recoup the debt.
Spousal Responsibility
North Carolina is not a community property state. This means that spouses are not responsible for debts incurred by their spouses during their marriage. If a resident of North Carolina dies, his spouse is not responsible for paying his credit card debt unless he and his spouse held the account jointly.
Warning About Debt Collectors
If a creditor isn't aware of a debtor's death or isn't able to secure payment from the estate of the deceased, it may turn the account over to a collection agency. The collection agency may try to persuade the spouse or other relatives of the deceased to pay the debt. However, family members are not responsible for their relative's credit card debts (or any other type of debt) unless they held the account jointly with the deceased or cosigned for the debt. If a spouse or relative gets a call from a debt collector concerning a deceased person's outstanding debts, she should direct the debt collector to the executor of the estate. She should also refrain from making any promises to pay the debt, and, if the debt collector persists in calling her, she should send the collector a letter ordering it to cease all further contact.
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