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What happens when a person dies with debt

Not all Nevada residents leave extra money behind when they die. Many people have outstanding debts, and settling them could deplete a decedent's entire estate. After a person dies, the executor or court-appointed administrator will be responsible for verifying all of the decedent's debts and paying the debts off with money in the estate.

It is important that an executor does not pay debts that the decedent did not owe. The first step to settling a deceased person's debts is to gather information about all of the decedent's open credit card accounts and to request credit reports from all of the credit bureaus. TransUnion, Equifax and Experian will each ask the executor for a certified death certificate, and supplying that document to the credit bureaus will prevent fraudulent accounts from being opened.

A deceased person's creditors will also need to be supplied with copies of the death certificate, and the creditors will need to know whether the estate is going through probate court. If there is still a remaining balance on a credit card account after the assets in the estate are depleted, the credit card company will generally not have any right to recover the rest. Executors are not obligated to pay off the decedent's debts out of their own pocket.

There are some situations where another party has a responsibility to pay off a deceased person's remaining debts. For example, if a debt that a person left behind was from a joint account, the other account holder may have to take care of it. This can often be a touchy part of estate administration that might require an attorney's advice and counsel.

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