Survivors never, ever, ever have to pay a dead person's debts with their own money. Period.

Now, the inheritance is *not* your own money until it is out of probate. As long as you understand that a debt collector may have legitimate rights to the inheritance during probate you should always explain to the debt collectors they have phoned the wrong person and to cease contacting you. Because you're a nice person explain to them they should phone the probate lawyer/judge and give the correct phone number and address.

This is the case in most parts of the world that read this site.

Weltman and Reis are scumbags of the highest order; no surprise that they would play such games.

I wonder if this will start a new kind of Nigerian Scam...

Dear Sir/Maddam,
I am the debtor of the estate of your 4th uncle Bob, the king of the Congo. He owes us money so now you do too. Pay up or we will send this email to 250 other people who you have no relation to.

Thanks
Some guy who uses Western Union.

Only sure things are debt, death and the bill collector is a lying SOB. All are equally painful, but most would rather die than deal with the other 2!

I read this story last night on NYT. Forwarded it to a few people over IM. WOW. Talk about scummy.

Now we just need to find out who the people are in the story that were paying the $15/mo, and have them read it. Chances are, 99.999% of the people that are paying are doing so because they feel they are LEGALLY obligated to the debt. Something tells me, we should inform them they are not :-)

I read this last night. The part that made me really angry was the widow at the end who was grateful to pay $5 whenever she could.

Scummy scumbags taking advantage any-which-way they can.

@jaydez:I am the debtor of the estate of your 4th uncle Bob.....

I am the "PREDATOR" of the estate of your 4th uncle Bob... I mean bill collector.

This is... new? I worked collections while in college, and we were trained to do exactly this 6 years ago. It was moreso because 3/4 of the time the person would have a family member answer the phone and claim they were dead, than because we thought we'd get money from survivors.

@shepd:
Do you even have to give that information? Can't you tell them that the person does not "live" (quit calling me) at this address/phone number and let them work for every cent they get by trying to figure out the rest? Why would you volunteer that info, are you required by law if you are executor, if not executor? no false statements...

My father died early in January, had hardly any debts to speak of and was in very good financial shape. There was a Citbank/Sears Mastercard bill that arrived a few days after his death -- the charges were legitimate and amounted to only a couple hundred dollars, so we just cut a check and sent it in as normal before calling to notify them of the death and that we were paying off and closing the account.

A week or so later, and still well before the due date on the original bill, we received a letter from a law firm noting that they'd received information that the account holder had died, with an attached collections notice for the amount on the aforementioned bill. By then, the Citibank phone system confirmed a zero balance, and the check cleared my mom's account days before.

We're somewhat at a loss for what to do now, if anything. Citibank says its a "timing thing" and not to worry about it, but the lack of professionalism and empathy is staggering, as we sincerely just wanted to pay the damned bill, close the account, and move ahead. Its extremely upsetting to have a company assume your family is going to try to take the deadbeat way out, and sic their lawyers on you before the next due date has even passed.

A few years ago when my husband's absentee, deadbeat father died, we were inundated with calls from collectors trying to settle the father's debt with us. Of course we didn't fall for it, but promptly directed (with an address and phone number) the collectors to the father's girlfriend who was the beneficiary of the deadbeat's estate.

Is it intentional that in this case the bill collecters put the "pathetic" in empathetic?

@metaled: A lot of people inform collectors that the person has died or passed on in an effort to get them to go away, since logic dictates that if they're dead, the debt can't be paid. Apparently they're no longer being thwarted by that information.

@jaydez: You might consider throwing in a death threat there, too, just to make sure the recipient understands you're serious.

@Jakuub: Well, I suppose your telemarketing overlords have to tell you something to get you to basically rob from the grave...

@jeffbone: OOOOOOOOOOOOOOOOOOOOOOOOO MUGUUUUUUUUUUUUU I DEY LAND HERE GUYMAN KEEEEEEEEEEEEP OOOOOOOOOOOOOOFFFFFFFF OOOOOOOOOOOOOOOOOOOOOOOO

@Trai_Dep: I understand the disgust for the profession, but this wasn't something they made up - I've spoken to more (supposedly) dead people than John Edward claims to have. Desperate people resort to desperate things (including working collections).

I had it happen with a friend of mine who died and left me as a reference. Like a year after they called adn asked for me and tried to get me to pay almsot 400 dollars. I was like umm I didn't sign anything so have fun with that and just hung up. They continued to get my voicemail for about 3 months after then it just stopped.

But wait, since it is a violation of the Fair Debt Collection Practices Act to contact friends/neighbors and family of someone owing a debt, their is room for a harassment suit!

In CA, at least (and I'm sure the other states, but I don't work in them), the heirs are not responsible for the debt, but the estate is.

If there is a significant estate and there's no trust, it's important to start a probate as soon as possible and send out notice to all known debtors so they can make their claims. That starts a 60 day window in which they must file a claim. If you don't start that window they have up to one year to come after the estate (which can be after distribution, which means anyone distributed to would have to give back some or all of their distribution to pay back the debt - though it's pretty rare for a probate to be over with in a year). Even if the claim is valid the creditors are SOL on the 61st day after notice or 1 year after the date of death (with caveat that there are ways to get around this, but they are very difficult and mostly not accepted by the probate courts).

Disclaimer: IANAL, but I've worked for many years in estate planning and probate.

I knew someone who committed suicide but before she did she ran up all her credit cards and took out a 2nd mortgage to take trips and live large. She knew that the money would not have to be paid back after she was gone. It was sad that the kids got nothing but she knew the law.

I'd simply tell them, if the person's estate was still in probate to make their claim to the court. If the estate was out of probate I'd tell them to get bent, they had their chance to collect money out of the decedent's estate and missed the boat, too effing bad for them. I don't know if they can make a claim against a living trust or not. I know they can't make a claim against a life insurance payout with a named beneficiary.

We're somewhat at a loss for what to do now, if anything. Citibank says its a "timing thing" and not to worry about it

@castlecraver: Do nothing, at least for now. I would guess that the company always sends a last bill when informed the account holder is deceased whether or not a due date for the balance has passed.

Arizona works in much the same way as described in Cattivella's post about California. And if the estate is under $50,000 (small estate exemption) all creditors are pretty much out of luck.

Also, sending a bill in the deceased's name isn't considered good enough to make a valid claim on the estate. There is a formal process a creditor has to go through and in Arizona if they don't do this within four months of the probate announcement being placed in the paper then the creditor's claims aren't valid.

Something else to keep in mind is that in some cases things like life insurance and other death benefits go directly to the beneficiary and not through the estate. So creditors would not have a claim on these funds.

@Rectilinear Propagation: Thanks. That's what we're hoping.

It sort of makes me wonder if a deceased account holder (unwisely) had automatic payments set up, if the CC co. would continue trying to deduct the payment after receiving a death notice? If, as evidenced by our experience, its possible that no human even looks at the account before collections gets brought in, how likely is it that some payment processing computer somewhere will just keep doing its thing, in spite of the fact that the surviving heir to the bank account isn't legally liable for the debt and may want to settle it through probate? Makes me wonder.

@metaled:

Of course, heck, you can just hang up. However, it is probably legally best that you did what was reasonable to let them get their debt cleared. Otherwise, I can imagine some sort of liability on your part for trying to dodge the debt. Now, just because I can imagine it doesn't mean you're legally liable at all, but if I can imagine taking you to court for it, I can also imagine a debt collector doing the same (and losing, after you pay a good chunk of lawyers' fees).

This has been going on for ages. Back in the 80s my girl friend's mother died broke after a long fight with cancer. Debt collectors would call my girl friend and say "I know your mother was an honorable person and would want her debts settled, so we're going to help you do the right thing by offering to settle the account in full if you can just pay half of what she owed."

Wow, what a deal.

@metaled:
That would make you no better than a shady debt collector. I guess if that's who you are, your suggested course of action would make sense.

@I_am_Awesome: It certainly would not make someone just as bad as a shady debt collector to do that. Not that one should be dishonest, but since I don't work for the collection agency, and the debt does not belong to me I am under no obligation to help them whatsoever.

"No, so-and-so is not available at this number anymore. Click." And yes, you should actually say "click" out loud.

This probably doesn't apply equally to the deceased's executor...

@I_am_Awesome:
Attempted insult accepted! Years ago, when my father-in-law died, My wife tried to do the right thing. One bill collector just tore her apart. They demanded we send the death certificate and copies of his closing bank statements. She was not responsible and had nothing to do with any of it. This guy pulled all type of crap, telling her that her father would be ashamed of how she was treating the memory of him, threatening to sue us. These guys are total asses and will scam you at your worst moments in life.
Am I this type of person? You bet I am! They made our lives hell, for something that had nothing to do with us. Think about what they do to widows, little old ladies who just lost their husbands.
BTW, my original example is based on this info, the person dies with nothing, The person they are calling is not responsible.. Why not tell them they do not live here and quit calling. It's a lot better than having to go through all the shit my wife did, having to prove they died and had no money. Those idiots had no right to put her through the things they did. Make THEM find out if the person is dead and broke rather than making her do everything under threats and intimidation. If we had I to do over again, that's EXACTLY what I would have her do. It's a lot better than the trauma and fear they put her through!

This job rates just above a sondercommando in Auschwitz as far as being a fulfilled human being.

@Cattivella:

What about if a debtor never receives the notice or doesn't know the person has died? are they still out of luck after the window closes?

@TEW:

i believe if she had life insurance then the proceeds of an insurance policy cannot be claimed by debtors... then again you can't committ suicide within the first 2 years (depending on policy/company i believe) of a life insurance contract and have it pay out, after that you're fine (or at least was for the company i used to work for)

You can't be serious this is allowed, they are exploiting a loophole in the law to collect. I bet the only ones where they expressly tell some one they don't owe the debt is for the papers...otherwise they whine and guilt everyone into paying, calling constantly. This crap should be outlawed.

@weave: So does this apply to spouses of the deceased? My mother died of cancer three years ago, and she hadn't worked for over 30 years. I assumed that my dad was on the hook for her medical debt.

When I was working as a banker, I had one elderly guy come in to the bank and ask me over and over, and call me to ask me again over and over whether he had to pay his dead wife's credit card balance. His name was not on the account anywhere, it was solely in his wife's name. I felt so bad for him because I knew he didn't need to pay it, and told him so, but the debt collectors kept misinforming him and he wasn't confident enough to tell them to stop calling. :/

@magstheaxe: You likely assumed correctly. Laws governing marital property (both debts and assets) vary from state to state but, generally speaking, spouses are liable for each other's debts.

@magstheaxe:

Was the debt on a joint account, or not? Was the debt secured? These are important questions!

Where I am, the only person/people responsible for a debt have their names signed to it. That would mean for a joint account or a reverse mortgage on a jointly held home (I imagine this is normally the case) both people are responsible parties if one goes dead(beat) the other party owes all outstanding debt.

If it's a personal loan, for example a personal line of credit or personal credit card of someone that has expired, the inheritance is raided to pay for it. If there isn't enough inheritance, tough bananas for the collector.

If the money is owed directly to the hospital, I don't know, that doesn't normally happen here. :^)

@shepd: I agree. While the law might "vary," I would love to see one that required family members of decedents to pay debts out of their own pockets (compared to using the decedent's estate).

@junip: Why wasn't he liable for the debt? In most cases you are liable for your spouse's debts, and vice versa. Whether or not your name was on the account would be immaterial.

@Trencher93:
That's a flat out depraved "comment".
The sondercommandos were ordered to do it!
They were then killed after a few months!

@Corbin123: That's ridiculous.

I am not responsible for anyone else's actions. If my dad runs up a boatload of debt before he dies, there's nothing I can do to stop him. His debt is his and his creditors' problem, not mine.

One stupid scenario might proceed as follows:

"Your estranged father died."
"Oh no!"
"In his will, he left you his $400,000 debt which leaves you bankrupt. The creditors will take everything you own and you'll have to start over."
"What? That doesn't make any sense."

@castlecraver:

Well, assuming the debt is legit, the CC company has claim on that bank account before the heirs do. The issue would be if _another creditor_ has prior claim on the assets in that bank account, in which case the CC company could be required to return the money, I suppose, as it was improperly distributed from the estate.

@weave: I hope she told them to go pound sand.

@shepd: I really can't think of a statute that would allow for a lawsuit for someone refusing to discuss someone else's debt. I'd certainly hope no one would want to allow for that precedent, either - feel like being sued because you don't know where your neighbour moved to or you're not giving out your nephew's mobile number? I sure don't.

@shepd: While we're imagining things, lets also imagine countersuing and being awarded legal fees and court costs for that ridiculous lawsuit.

@Corbin123: How does that make any sense? The estate stays untouched but everyone else is responsible out-of-pocket for debts that someone else incurred? What are you smoking?

"If you don't pay the debt, we'll exhume their corpse and sell it to Bill "Cat Killer" Frist to perform experiments on."

@JiminyChristmas:

I am fairly sure that is NOT true for most states and am positive it is not true for the state of PA.

Unsecured debts are not inheritable by a spouse or otherwise unless they are JOINT account holders, even if they are authorized users of a credit card they are not liable.

Now secured debts are a different issue, they are linked to an asset such as a house so if the husband dies and the wife still wants to live in the house she better start paying the mortgage payments or the house will be gone.

Debt incurred during the marriage might be inheritable in a community property state which are as follows:
* Arizona.
* California.
* Idaho.
* Louisiana.
* Nevada.
* New Mexico.
* Texas.
* Washington.
* Wisconsin.

As for assets, ANY assets which are jointly owned (paid off house, car or bank account) immediately transfers to the spouse upon death and is not subject to probate and the creditors have no right to those assets.

Any debt collectors should be told to speak to the executor of the estate, it is his or her job to gathers all of the debts and assets and distribute those. There are also "tiers" of who gets paid first and last (CC companies are last).

If the estate does not have enough money to pay all of the debts then the estate is considered insolvent and not everybody gets paid, simple as that.

My father passed away 12/25/08 and has a very complicated estate, I a working closely with the lawyers and can confirm all of this information to be true for the state of PA and am fairly sure it is for most states.

@ilves:

You are correct,

Life insurance proceeds pass separate of the will and are not taxable or can creditors claim the right to them.

The only case this would be an exception would be if the insurance beneficiary is the estate of the person who died (which would be the dumbest thing you could do)