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.....so about debt
Sunlight Theory
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Registered User regular
My roommate and I were having a discussion about debt earlier this evening and the question arose as to what happens to someone's debt when they die. I tried researching it and couldn't escape information about our national debt so I figured I would post here and see what people had to say. So here's the question, what happens to your debt when you die? Does it get passed on to your children? What if you don't have children? If anyone could provide a source with information on this it would be great as well.
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I fix computers under the table to survive, but I'm in a small town so busy isn't exactly booming. I mostly do barter jobs for people who really don't know anything about technology.
I'd declare bankruptcy but about half of my debt is from student loans.
EDIT: Although if you have an inheritance coming from your parents, and their debt is greater than the inheritance, you get nothing because creditors get paid first.
― Marcus Aurelius
Path of Exile: themightypuck
I'm pretty ignorant about the subject, so I might be talking out of my ass, but I don't think it's so much that the debt is passed onto the next of kin as it is passed onto the estate. If I'm not mistaken, this would mean that you're not obligated to pay the debt of your parents by mere virtue of being their child, but anything they might own or you might inherit can be repossessed to help cover the cost of the debt. Which would seem to be more justifiable than a blanket "you must pay the debt of your parents."
Though it will vary by state, and I'm pretty sure it actually passes on to the spouse before the estate.
You can still take a lot of stuff out before the debtors can come in to take it though. Bank accounts and the like you will lose for sure, as will estates, but nobody will know if you go to your parent's house and take most of the jewelry, hard cash, etc.
Off topic, Navoc, where did you get your sig? Do you know the person who made the painting in your sig?
I wonder of the legality of something like that. Obviously it's not something you'd ever be charged over, or anything. I'm just curious if technically those objects become property of the creditor (or whomever it would be) upon death, or something. Pretty irrelevant either way, I suppose.
Also: my sig is from this painting. I don't know the painter personally, if that's what you mean, I just really liked the painting.
Roughly the same reason that you get to be rich if your rich parents die. I'm not saying that it's logical, but it is somewhat consistent.
IOS Game Center ID: Isotope-X
The exceptions are if your name appears as a user on that other person's account somewhere, or debts incurrred by a spouse during marrriage.
Oh thank God, because my fiancee owes a lot of fucking money.
I'm wondering if it's possible for her to declare bankruptcy then become a housewife, never having to pay those bastards back.
As for being responsible for other people's debt, I think you only have to worry about things you cosign on, debts of your spouse (past debts can come into play if things are refinanced or rolled together, etc) or possibly debts your children incur (I believe in some circumstances the courts have made the parents pay for certain things when their children are being declared as dependants or are underage, etc.)
I think death is part of the risk associated with lending money really - I wonder if age of the lender figures at all into approval / interest rates at all...
stout's Amazon Wishlist | my lastFM
:oops:
I don't know about them in general but mine specifically does not carry over if I die.
stout's Amazon Wishlist | my lastFM
Nope. It will, however, get taken out of your estate, so your next of kin will lose that money in a round-about way, but they don't actually take on the debt itself.
A guy I worked with is taking out loans for nursing school. He told me that they changed the law about a year ago so that student loans are fully passed on to next of kin. Anybody have any solid evidence? That sounds screwed up.
and another one
Both these seem to imply that the only way you inherit debt is by inheriting property used as collateral on the debt.
"In the event of the borrower's death, or on or after July 23, 1992 the death of the student for whom a parent received a PLUS loan, the obligation of the borrower and any endorser to make any further payments on the loan is discharged.
To verify a borrower's death, the servicing agency must have either the original death certificate or a certified copy of the death certificate."
Based on that, I would say that federal student loans are not passed on and may not even be taken out of any kind of estate of the deceased.