When Whitney Houston died on February 11, 2012, rumors swirled about the late singer. One of those rumors was that Ms. Houston was broke when she passed away, having run through all the money she earned in the 80s and early 90s.
This begs an interesting question. What happens to your debt in death? Does it disappear? Does it pass on to your heirs? Who is responsible?
It depends on the type of debt you have. Generally, your debt does not pass on to your loved ones after you die. Your debt is yours and yours alone. There are exceptions to this rule, though. Following is a breakdown of different types of debt and how they are handled after death:
Single Signer: If you are the only person who took on the debt, nobody else is responsible for it. Your assets will be used to pay down the debt.
Cosigners/Joint Account Holders: If someone co-signed loan with you or is a joint account holder, they will be responsible for payments after your death.
Authorized User: An authorized user of your credit card is not responsible to make future payments, but must cease using the account upon your death.
After you die, your debts are prioritized and paid off using assets from your estate.
If you find yourself or know someone in financial distress and need a solution, an experienced debt relief law firm such as Harold Shepley & Associates would be able to answer your questions with a free consultation.
Contact us today at 1-866-284-7062 or visit us at www.shepleylaw.com to find out more information on your debt relief options.