What Happens to Credit Card Debt When You Die?

The highlights of this article include:

  • A look at what happens to your credit card debt when you die.
  • An explanation of how and in what instances your leftover credit card debt could affect your family members.
  • A few tips on preventing any debt-related problems from cropping up upon your or a family member’s death.


Death brings about many serious questions. One that is not very commonly asked is ‘what happens to your credit card debt when you die?’

Obviously, there are more pressing concerns when you die. Namely, actually being dead yourself, or dealing with the grief and mourning related to a close family member’s passing. And on top of that are all of the preparations related to the burial, funeral, and memorial processes that need to be sorted out.

But family members might just be in for a surprise when a family member dies. And, like most things surrounding death, it’s not a pleasant one. Though it is often jokingly referred to as an inheritance, this particular inheritance isn’t one that you would want to receive – instead, it comes in the form of unpaid credit card debt.

The fact of the matter is that when a person dies their estate pays off all of their unpaid credit card balances and other debts. But if the person who died has more debts than available money or other assets to pay them, then, well, you could just be stuck taking on their debts in addition to all of your other burdens.

When Might You Be Stuck With Their Debt?

Luckily for all of us, it is reasonably rare for a dead family member’s unpaid credit card debt to fall into someone else’s arms as a financial responsibility. Usually the creditors are just out of luck. While it doesn’t happen often, it still does happen.

It is most common in the case of a joint cardholder. If you are a joint cardholder, then you’re liable to have the other cardholder’s debt transferred to yourself upon their death. A joint cardholder is someone who co-signed for the credit card. If you did not co-sign, so you might just be an authorized user, then you are in the clear.

Spouses and parents co-signing for their children are the most common instances where this can happen. Adult children who co-sign for a card with their elderly parents are another common case.

Play it Safe

One of the best ways to lower the risk of having a dead family member’s credit card debt become your own is by playing it safe. Don’t co-sign for a credit card unless it is absolutely necessary or unless you completely understand both its risks and rewards.

Furthermore, you should check your credit report regularly. An annual free check is all but necessary for most people in the modern client. In fact, since you can check your credit report for free, there is no reason why you shouldn’t be keeping an eye on this particularly important area of your financial life.

Part of the reason that it is so important to keep an eye on these things is because you can sometimes be on a credit card and not even know it. As crazy and backwards as it sounds, you can be added to a credit card during the application process by your spouse without even being told. Then when a death (or a divorce) comes around, you might be stuck with a huge burden of debt on your shoulders without ever having had an inkling of the fact beforehand.

Who Gets Custody of a Credit Card?

Though divorce proceedings and settlements, including the transfer of debt and credit card loans, varies on a state to state basis, one thing remains the same: if an ex-spouse agrees to pay off a joint credit card debt as part of the divorce settlement but then dies before doing it, the other spouse is stuck with it.

Simply put, if your name’s on the card, there is still a chance – a big chance, really – of your being pegged with the payment. Credit card companies aren’t going to let you off the hook that easily.

What Happens If Someone Uses Your Credit Card After You Die?

Things can quickly become sticky if you use someone’s credit card after they die. This is even the case if you are an authorized user.

Continuing to use a credit card (even as an authorized user) after the main cardholder passes away has criminal implications. You can get into big trouble because of it.

The same sort of thing is true if you use a credit card as an authorized user when you know that the debt won’t ever be paid off. In fact, it is considered fraud if you use a credit card when you know that your parent (the cardholder) is near death and doesn’t have enough money to pay the associated debts off.

Effects of Credit Card Debt On Your Estate

Leftover credit card debt has a huge impact on your estate after you die. This, in turn, directly affects your family members.

Even if your family members are not required to personally take on the debt and pay it off, they will still feel its sting. The debts will need to first be paid from the estate. This is one of the first things that is done. Only after this is taken care of is the rest of the estate distributed among beneficiaries.


Many things can happen to your credit card debt when you die. Most commonly, whatever is remaining of it is paid out of your estate. In some instances, however, especially those involving a joint co-signer, your debt is transferred over to a surviving family member.

If a close family member has died, there are several things that you can do to protect yourself. The first is contacting their credit card company immediately and explaining the situation. You should also consult your attorney before making any debt payments out of an estate. You and your family might even consider ditching your credit cards for debit cards to cut out on some of the hassle.

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