What happens to debt when the debtor dies Philippines?

After a relative dies, the last thing a grieving family member wants is a call from a debt collector asking them to pay a loved ones debt. Heres what to know about the rules and yo

What happens to debt when the debtor dies Philippines?

After a relative dies, the last thing a grieving family member wants is a call from a debt collector asking them to pay a loved ones debt. Heres what to know about the rules and your rights when a collector contacts you about a deceased relatives debts.

  • What To Know About a Deceased Relatives Debts
  • Report Problems

What To Know About a Deceased Relatives Debts

Whos responsible for a deceased persons debts?

As a rule, a persons debts do not go away when they die. Those debts are owed by and paid from the deceased persons estate. By law, family members do not usually have to pay the debts of a deceased relative from their own money. If there isnt enough money in the estate to cover the debt, it usually goes unpaid. But there are exceptions to this rule. You may be personally responsible for the debt if you:

  • co-signed the obligation, like a car loan
  • are the deceased persons spouse and live in a community property state, such as California
  • are the deceased persons spouse, and live in a state that requires you to pay certain kinds of debt, like some healthcare expenses
  • were legally responsible for resolving the estate and didnt follow certain state probate laws

If you have questions about whether youre legally required to pay a deceased persons debts from your own money, talk to a lawyer. Depending on your income, you may qualify for free legal services from a legal aid organization near you.

Who can pay debts out of the deceased persons assets?

The executor  the person named in a will to carry out what it says after the persons death  is responsible for settling the deceased persons debts.

If theres no will, the court may appoint an administrator, personal representative, or universal successor and give them the power to settle the affairs of the estate. In some states, that power may be granted to someone else who was not appointed by the court. For example, state law may establish another process for someone to become the representative of the estate even if they havent been formally appointed by the court.

Can a debt collector talk to a relative about a deceased persons debt?

The law protects people  including family members  from debt collectors who use abusive, unfair, or deceptive practices to try to collect a debt.

Under the Fair Debt Collection Practices Act (FDCPA), collectors can contact and discuss outstanding debts with the deceased persons

  • spouse
  • parent(s)  if the deceased was a minor child, which is generally under age 18
  • guardian
  • executor
  • administrator

Collectors can also contact any other person with the power to pay debts with assets from the deceased persons estate. Debt collectors may not discuss the debts of a deceased person with anyone else.

If a debt collector contacts a deceased persons relative, or another person connected to the deceased, what can they talk about?

Collectors can contact other relatives or other people connected to the deceased (who dont have the power to pay debts from the estate) to get the name, address, and telephone number of the deceased persons spouse, executor, administrator, or other person with the power to pay the deceased persons debts. Collectors can usually only contact these relatives or other people one time to get this information, and they cant discuss the details of the debt.

Collectors can reach out again for updated information, or if the relative or other person gave the collector wrong or incomplete information. But, even then, collectors cant discuss the debt.

If I have the power to pay a deceased persons debt, can I stop a debt collector from contacting me about the debt?

Yes, the law says you can stop a collection company from contacting you. To do this, send a letter to the collector. A telephone call isnt enough. Tell the collector you dont want them to contact you again. Make a copy of the letter for your files, send the original by certified mail, and pay for a return receipt so you can document when the collector got the letter.

Once the collection company gets your letter, it can only contact you to

  • confirm it will stop contacting you from them on, or
  • tell you it plans to take a specific action, like filing a lawsuit.

But even if you stop collectors from communicating with you, the debt doesnt go away. The collectors may still try to collect the debt from either the estate, or anyone who fits one of the categories listed above.

Where can I learn more about debt collection and my rights?

Read these Debt Collection FAQs.

Report Problems

What should I do if I think a debt collector is breaking the law?

Report any problems you have with a debt collector to

  • the Federal Trade Commission at ReportFraud.ftc.gov
  • your state attorney general

Many states have their own debt collection laws that are different from the federal law. Your state attorney general's office can help you understand your rights under your states law.TopicsCredit, Loans, and DebtCredit and DebtScamsAll ScamsDebt and Credit ScamsMay 2021

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