Tips For Negotiating The Credit Card Debt Of The Deceased


If you’re the executor of a decedent’s estate, one of the first tasks you’ll have to do is deal with their credit card debt. You’ll want to get organized and know what debts are on your plate before you start contacting creditors. You may also need help navigating the process of understanding what happens to credit card debt when you die and how to deal with creditors. So, this article will guide you through; scroll down to read further.

Getting organized

The first step to negotiating with credit card companies is getting organized. The best way to do this is by making a list of all the debts and gathering the original credit card agreements, last statements and documents showing proof of death like a death certificate or obituary. You’ll also need to contact the deceased’s name off all three credit reports. After you’ve done this, you can start setting up phone calls with each creditor.

Pull a copy of the deceased’s credit report

Pull a copy of their credit report to get a sense of your loved one’s credit profile. You can do this by contacting the three major credit bureaus (Experian, Equifax and TransUnion) and requesting one be sent to you. It’s important to note that pulling a credit report will not affect the deceased’s score or rating because they are no longer alive; however, it will give you an idea of what they owe and to whom.

Document every debt you find

It would help if you documented every debt you find. Keep a list of all the debts you discover, where they are owed and their balances. This can be in a spreadsheet or in a notebook. Make sure to keep this list in a safe place so that it doesn’t get lost when your loved one passes away. It may also be helpful to make copies of this list and distribute them among relatives who will need access to it.

Reach out to creditors

Creditors are not required to pay off the debt of a deceased person. They can and often will try to collect from you, but they do not have to. The credit bureaus are also not required to report the passing of your loved one, but many creditors will request that they do so anyway. This is because creditor reporting is how creditors verify that an account was in good standing before death or if there was any activity after death to dispute or offset with other accounts.

Check for funeral expenses and bills.

The first thing to do is check for funeral expenses, including any bills or debts not covered by life insurance. The executor of the will is responsible for paying any expenses related to the estate. If you are not the executor, then you can request that they pay these bills on behalf of your loved one before they pass away. However, if there is no will in place and debts are to be paid from inherited assets, those costs may also fall on you.

SoFi experts explain, “If a deceased relative’s credit card debt exceeds their total assets, don’t panic. In the instance the estate doesn’t have enough money to cover all of the deceased’s debt, state law will determine which debt is the highest priority.”

If you’re lucky in this situation, don’t let it go to your head. You’re not going to go through this process alone. Your first step should be to reach out to a licensed attorney who can guide you through the process of settling the debt and distributing it as you wish.

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