When Spouses Die, Do Their Debts Have to Be Paid?

Unfortunately, when a person dies, his spouse must often simultaneously manage both her grief and the debts he left behind. A couple's state of residence, financial situation, and the types of debt the deceased owed all determine whether or not a debt must be paid after the debtor dies. As a rule, family members do not inherit debt in the same way they would inherit assets.

Secured Debts

When a consumer provides her lender with collateral for a loan, the lender can seize the collateral if the borrower does not repay the loan. These types of debts are "secured" assets. Married couples often jointly apply for secured debts, such as a mortgage loan. Any debt that a couple jointly owes, a surviving spouse is liable for. If the secured loan in question was the liability of the deceased spouse, the surviving spouse is not legally liable for payment. Regardless of the surviving spouse's legal responsibility to make payments on the secured debt, if she fails to do so the lender will repossess the asset after her spouse's death.

Unsecured Debts

Unsecured debts, such as credit card debts, that exist solely in the deceased name are not the surviving spouse's responsibility to repay. The unsecured creditor can file a payment claim with the probate court responsible for distributing the deceased's estate. If enough money exists in the deceased's estate to pay off the unsecured creditor's claims, the probate court will pay off the debts before distributing any remaining assets to the deceased's spouse and other heirs. If limited assets leave the probate court without enough funds to pay off all unsecured creditors, the debts remain unpaid.

Considerations

If the couple lived in a community property state, debts acquired by either spouse are the responsibility of both spouses provided the individual who originally applied for the debt did so after the marriage. This renders the surviving spouse legally responsible for any debts that his spouse owed. Creditors may then pursue the surviving spouse for payment through collection activity or a debt collection lawsuit.

Unpaid Debts

If the probate court does not pay off a deceased individual's debts, the debt in question is not a joint account and the couple did not live in a community property state, the surviving family members are not liable for payment. Creditors may turn unpaid accounts over to collectors, but the Fair Debt Collection Practices Act forbids collection agents from informing the deceased's surviving family members that they are responsible for repaying debts or that their failure to do so will have legal consequences.