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What Happens to Credit Card Debt When One Dies?

Epic Loans Editorial Team

What Happens to Credit Card Debt When One Dies

With a large number of people dealing with overwhelming credit card debt, some might not be able to settle this debt in their lifetime. But what happens to credit card debt when the borrower dies? The responsibility to settle the credit card debt of the deceased falls on their estate – everything they had owned at the time of death, including money in their bank accounts and any other assets or possessions. Relatives are typically not on the hook for their deceased family member’s credit card debts, with certain exceptions. But, if the estate does not have enough money, credit card companies may have to absorb the loss.

Who is Responsible for a Deceased Person’s Credit Card Debt?

If the borrower has left any debts behind when they die, repaying the lenders is prioritized over settling with the heirs or beneficiaries. But who exactly is responsible for the credit card debt after the cardholder’s death?

The Estate

The estate includes everything one owns at the time of death, including everything in their bank accounts, their possessions, and assets. If one has more debts than their estate is worth, there could be one of three possibilities: 

  • A joint account holder or co-signer must pay the credit card debt
  • The surviving spouse in a community property state must pay off the debt
  • The card issuer may have to write it off as a loss


Probate is the process of gathering all assets of the deceased and using them to pay any taxes and debts of the deceased before distributing the remaining assets per the will or state law.


An executor is a will- or court-appointed individual responsible for managing and administrating the deceased person’s estate. The executor is responsible for ensuring that the debt is settled using the deceased person’s estate.


Beneficiary or beneficiaries are the people (or entities) that would legally receive the assets (financial or otherwise) of the deceased person. In some cases, depending on the state laws, beneficiaries may be responsible for settling their credit card debt.

Next Steps after a Person has Passed Away

So, what should family members do after a person’s death to manage their credit card debts? The steps to take after a cardholder’s death are:

Stop Using the Credit Card

Unless you are a joint account holder, stop using the credit card, even if you were an authorized user.

Inform the Credit Card Company and Credit Bureaus

Inform the credit card company immediately and take the necessary steps to close the account (for sole credit card holders) or remove their name from the joint account. You will need to send copies of death certificates to credit card and life insurance companies.

In case of a joint account, you will have the option to keep the account open in your name, but the terms and conditions of the credit card agreement may change.

Credit card companies report a cardholder’s death to credit bureaus, but it may take time. You should also consider notifying consumer credit bureaus to request a credit freeze and prevent potential identity theft.

Make a List of Credit Card Accounts

Try to make a complete list of credit card accounts the deceased had. The spouse or executor can request a credit report to make sure you do not miss any accounts.

Organize the Documentation

Continuing from the previous point, make sure to organize documentation for all financial accounts the deceased had in their name. This can help the executor manage and pay off all the debts from the estate before distributing it to the beneficiaries. It can also help joint account holders make timely payments and avoid harming their credit score.

What Happens to Credit Card Debt When One Dies

Protect Your Specific Assets from Creditors

As an unsecured loan, credit card debt has lower priority, with states placing varying statutes of limitations on how long a creditor may pursue payment after a cardholder’s death. In case the estate has insufficient funds, the beneficiaries need to understand that creditors are likely to target other assets. However, retirement accounts, living trust assets, life insurance proceeds, brokerage accounts, and homes (depending on the legal circumstances) are some of the secure assets creditors cannot pursue. But, it is essential to know your rights when dealing with creditors and debt collectors.

Credit card companies or debt collectors can contact family members to settle unpaid debt. But, according to the Fair Debt Collection Practices Act (FDCPA), creditors cannot coerce or force surviving family members to pay off the credit card debt of the deceased. So, understand your state laws and see if you are responsible for the debt before giving any money to debt collectors, either from the estate or your personal funds.

Credit card companies must present a Proof of Claim when requesting payments from the estate. So, if a creditor is contacting you about the credit card debt of a deceased family member, it is a good idea to seek guidance from an attorney, organize proper documentation, and figure out the most efficient way to pay off the debt. You will need to be extra mindful if you had any joint credit card accounts with the deceased, as your own assets and inherited benefits could be the target of creditors.

Once the estate has paid off the credit card debt, credit card companies need to write off any obligation the deceased may have had. After that, it is best to destroy the credit card.


Handling the finances of a recently deceased loved one can be challenging, especially when it comes to managing any debt they may have left behind. Credit card debt does not just go away with the cardholder’s death. Sometimes, their estate or co-signers are responsible for paying off their debts. It is important to take appropriate steps to manage credit card debt after death, like contacting credit card issuers to cancel the card, notifying credit bureaus to freeze credit and avoid identity theft, and properly organizing financial documentation. If you had a joint credit account with the deceased, be sure to manage and repay the debt so that their debt does not affect your credit.

Working with Epic Loans‘ Debt Consolidation Specialists can help you come up with the best credit card debt consolidation loan to make sure you can pay off your debts easily and quickly.

Frequently Asked Questions:

What should I do if creditors start harassing me?

Per the provisions of the Fair Debt Collection Practices Act (FDCPA), debt collectors cannot harass or intimidate family members to collect unpaid debts of a deceased person. You should submit a complaint with the Consumer Financial Protection Bureau (CFPB), the Federal Trade Commission (FTC), or your state attorney general’s office if you feel creditors are harassing you.

What happens if one dies and owes money on a credit card?

If one dies and owes money on a credit card, their estate will be responsible for settling the debt. If their estate does not have enough money, the joint account holders or co-signers are responsible for the repayment. If the card was owned solely by the deceased, based on state community property laws, either their surviving spouse repays the debt, or the card issuer may have to write off the debt as a loss.

Do we have to notify the credit card company of a cardholder’s death?

Yes, you have to notify credit card companies and consumer credit bureaus of a cardholder’s death to freeze credit and avoid identity theft.