Is the Estate Responsible for the Deceased's Credit Card Debt?

Signing a contract with a credit card company makes you liable for the purchases you make using any credit cards the company provides. Upon your death, you can no longer make payments---but the credit card company remains legally entitled to collect the outstanding balance you owe. Credit card companies have the right to collect unpaid debts from the estates of deceased cardholders.

Probate Court

Upon your death, your assets and debts immediately fall under the jurisdiction of the probate court. Any assets left behind constitute your estate. Each creditor must file a claim against your estate with the probate court in order to get payment. The time frame for filing a payment claim varies depending on your state. After the credit card company files a claim for payment, the probate court and the individual designated to represent your estate pay your debts and distribute any remaining assets to your heirs. This occurs whether or not you left a will.

Joint Accounts

If you were not the sole user of your credit card account and instead shared a joint account with a loved one, that individual assumes full responsibility for paying off any debt you incurred on the card. Rather than each sharing responsibility for 50 percent of the debt, joint account holders are each responsible for 100 percent of the charges made against the account. In this case, the credit card company would pursue the remaining account holder for the debt rather than filing a claim against your estate.

Authorized User Debt

Your credit card company cannot file a claim against your estate for credit card debt you incurred but do not legally owe. Such is the case with authorized users. Similar to a joint account holder, an authorized user shares a credit card account with another individual. While joint account holders apply for the card together and obtain approval based on the credit rating and income of both parties, a cardholder adds an authorized user to his account after obtaining the card. Authorized users can then use their credit cards to incur debt, but are not legally responsible for payment. Thus, if you incurred debt as an authorized user, your credit card company cannot file a claim against your estate and will instead expect the primary account holder to pay off your purchases in full.

Insolvency

Carrying more debt than assets renders your estate insolvent and incapable of paying off all of the creditors you owe. Should this occur, your credit card provider has little recourse other than writing off your outstanding debt as a business loss. Although credit card companies sometimes hire collection agencies and attempt to collect a deceased consumer's debt from her surviving family members, family members have no legal obligation to pay off the debt.