Who Is Responsible For Debt After Death?


When a loved one passes away, managing what happens to their money, assets and outstanding debts might not be at the top of your priority list but it’s an important process that you will eventually need to go through. Although you will be dealing with emotional turmoil and upset, you may find yourself in the position where you will need access to the deceased’s investments and as such, consideration needs to be given to your rights and obligations. In this article, who is responsible for debt after death, we take a look at the process and steps involved.

Free Initial Telephone Discussion

For a free initial discussion on how we can help you with the legal aspects of dealing with your loved one’s debts when he or she dies, get in touch with us today. We will review your situation and discuss the options open to you in a clear and approachable manner. Early expert legal assistance can help guide you through the whole process and also help you avoid the stress of dealing with these issues on your own. Simply call us on 0345 901 0445 or complete our online enquiry form and a member of the team will get back to you.

What steps to take when someone dies

In addition to dealing with the funeral arrangements, there are a number of steps that need to be taken before you can deal with the deceased’s financial affairs:

  1. You should register the death within 5 days. By doing this you will obtain a death certificate. This is an important document that you must keep safely as you will need the original in order to gain access to the deceased’s bank accounts.
  2. If the deceased left a Will, an executor will have been named. This is the person responsible for handling the estate of the deceased. Once the executor has the original copies of the Will and the death certificate, they can apply for probate. If someone dies without a Will, the application process is the same, but you’ll get ‘letters of administration’ rather than a ‘grant of probate’.
  3. You will need to estimate any inheritance tax liability and notify HMRC of the same. We can advise on this.
  4. Once you have the Will, death certificate, and grant of probate, you are then in a position to notify the banks, utility and insurance companies.

Who is responsible for your debts when you die?

Your debts become the responsibility of your estate after you die. The executor of your estate is the person(s) responsible for dealing with your Will and estate after your death. They will use your assets to pay off your debts. Debt isn’t inherited in the UK, which means that family, friends or anyone else cannot become responsible for the individual debts of the deceased.

You’re only responsible for the deceased person’s debts if you had a joint loan or agreement or provided a loan guarantee and as such you aren’t automatically responsible for a spouse’s or registered civil partner’s debts. Consequently, the Personal Representative is not personally liable for the debts of the deceased and those debts are likely to have to be paid from the estate of the deceased.

If two or more people have taken out a loan together, in normal circumstances the outstanding debt will pass in full to the surviving people who took out the loan.

If there is a mortgage, then your surviving spouse, registered civil partner or cohabiting partner, must pay that mortgage. However, it is not required to pay any of your other debts.

It should be remembered that if you are joint tenants, your home does not form part of your estate. The value of the deceased person’s share of jointly owned property is included when calculating the value of the estate for Inheritance Tax purposes.

If you are the sole owner, the executor of the Will normally uses any assets to settle debts. Depending on how much is owed, this could potentially involve selling off the property.  The situation is the same if you are joint owners under tenancy in common.

What happens to money owed on my credit cards?

A common misconception is that any credit card debts are automatically written off. Instead, any individual debts must be paid using the money the deceased has left behind. Only if there isn’t enough money in the Estate may the debt be written off.

Undisclosed debts

Once all the debts have been paid off, the executor might discover a debt they knew nothing about. A way to avoid this is to advertise in a local newspaper before you start arranging to pay the debts. This gives the deceased’s creditors time to come forward with any claims.

You aren’t under a legal obligation to place a Deceased Estates Notice, but if you fail to do so, you could put yourself at risk. This is because if you distribute the Estate and a creditor then comes forward, you could be found personally responsible. You might therefore have to pay the debt from your own pocket. A period of at least two months should be allowed from the date of the advertisement for the submission of any potential claims on the estate.

How we can help

We have a proven track-record of helping clients deal with probate matters. We will guide you through all the necessary legal due diligence in a comprehensive and timely manner. We firmly believe that with the right solicitors by your side, the entire process will seem more manageable and far less daunting.

How to Contact our Wills and Probate Solicitors

It is important for you to be well informed about the issues and obstacles you are facing. However, expert legal support is crucial in terms of guiding you through the often emotional process of probate in a sensitive and supportive manner and help ensure you achieve a positive outcome.

To speak to our Wills and Probate solicitors today, simply call us on 0345 901 0445, or allow a member of the team to get back to you by filling in our online enquiry form . We are well known across the country and can assist wherever you are based. We also have offices based in Cheshire and London.

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