Person Responsible for a Credit Card Debt of a Deceased

One of the difficult parts of losing a loved one is sorting out her financial affairs. This is particularly tricky if the person died owing money. When this happens, the person sorting out her estate may find it difficult to determine what money is owed to creditors and what money can be passed on to family members. In general, creditors have first dibs on a deceased person's assets.

Card Debts

When a person dies, his debts do not necessarily die with him. In the case of credit card debts, who has to pay for them will depend on in whose name the cards were issued. If the credit cards were issued in the name of the deceased alone, then the creditors may lay claim to the person's assets in court. If the cards were co-signed by someone living, then creditors can pursue debt collection from him.

Inheritance

A deceased person's relatives will only be able to inherit a person's debts after his creditors have been satisfied. If a beneficiary of the deceased person's estate lays claim to property before the creditors have been satisfied, he risks having to surrender this property at a later date. Credit card companies will be given an opportunity to assert their claims for a period of time after the person's death.

Community Property States

In some states, such as California, the property of a spouse is considered common property with the other spouse. If one spouse dies with credit card debts, then the creditors will have a right to lay claim to the assets of the living spouse, even if the living spouse did not co-sign the credit cards. However, in other states, credit card companies can only lay claim to property owed solely by the deceased spouse.

Considerations

Disputes between credit card companies and surviving family members are not uncommon, as there may be disagreements about what property was owned by the deceased and what was owned by her surviving family members. Disputes will be heard and arbitrated by a court judge. However, the family members may also attempt to reach an out-of-court settlement with the credit card companies, which will be legally binding if both parties agree to it.