Credit Card question?

[garyt]

So my wife's sister is married to a guy who has no spending self control. He has run up huge debts on his credit cards. Her name is on none of these cards. If he dies will she be responsible for these debts?
I'm of the opinion that she will be because they're married but thought I'd ask.

 

[erkevin]

Usually no, as she is not a shared account-holder or co-signer. It is state-dependent however. What state do they reside in? Also keep in mind; if he passed, the Executor could tap into joint assets to pay off those debts.

 

[LateToFIRE]

What erkevin said - wife might not be directly liable for the CC debts, but the creditors might come after DH's assets, including any assets that would have passed on to her and/or any jointly held assets.

 

[Texas Proud]

More than likely if in Texas as it is a joint property state...


It is an assumption, but I bet in a separate property state it is not..

 

[stephenson]

Couple of links - a lot of advertising, though. Hundreds of attorney links with same sort of info.

https://www.bankrate.com/finance/credit-cards/liable-for-spouses-credit-card-debt/#common

https://www.nolo.com/legal-encyclopedia/am-i-liable-my-spouses-credit-card-debt.html

 

[Koolau]

Usually no, as she is not a shared account-holder or co-signer. It is state-dependent however. What state do they reside in? Also keep in mind; if he passed, the Executor could tap into joint assets to pay off those debts.

I'm hoping this is the way BFF "protected" his DW from at least some of his debts. I'm pretty sure they had "his and hers" CCs. Of course, she too ran up a lot of debt on her card(s).

 

[garyt]

Usually no, as she is not a shared account-holder or co-signer. It is state-dependent however. What state do they reside in? Also keep in mind; if he passed, the Executor could tap into joint assets to pay off those debts.

They are in Michigan

 

[SecondCor521]

When he dies, his estate will be responsible to pay his debts.

His debts would typically include final medical expenses, burial expenses, final income taxes, and then any other debts like credit cards, personal loans, mortgages, car loans, etc.

Leftovers, if anything, would go according to his will if he has one or state intestacy laws if he doesn't. If there are still debts left over after all assets have been liquidated, then those typically go unpaid and she is not responsible for them.

Determining what is in "his" estate and what are "his" debts is a matter of state law, so I'd recommend she get a quick consult with a Michigan attorney. Almost certainly (ETA: Maybe not, see post #11 below) the credit cards are "his" debts, but what of "their" assets would end up in "his" estate is where she would have to look at state law and their specific facts and circumstances.

 

[pb4uski]

So my wife's sister is married to a guy who has no spending self control. He has run up huge debts on his credit cards. Her name is on none of these cards. If he dies will she be responsible for these debts?

I'm of the opinion that she will be because they're married but thought I'd ask.

What others have said. If her name is not on the credit card account and she does not have a credit card she will not be responsible for her husband's credit card debts.

However, any of his assets would go to pay debts first and only any excess of assets over debts can be passed on.

If his debts exceed his assets she should try to minimize any jointly held assets. Do they own a home jointly?

She also needs to know that the credit card companies and collection people are low-lifes and will insinuate that she is responsible for his credit card debt when she isn't. If they pressure her in this direction she should respond that they need to talk to her lawyer.

 

[teej1985]

What others have said. If her name is not on the credit card account and she does not have a credit card she will not be responsible for her husband's credit card debts.

However, any of his assets would go to pay debts first and only any excess of assets over debts can be passed on.

If his debts exceed his assets she should try to minimize any jointly held assets. Do they own a home jointly?

She also needs to know that the credit card companies and collection people are low-lifes and will insinuate that she is responsible for his credit card debt when she isn't. If they pressure her in this direction she should respond that they need to talk to her lawyer.

So, credit cards aren't considered community debt in community property states?

 

[SecondCor521]

So, credit cards aren't considered community debt in community property states?

Interestingly, it appears so in Idaho (a community property state and where I live).

My Mom passed away in Idaho and in her probate inventory, 1/2 of her credit card balance was attributed to her and 1/2 was attributed to my Dad.

It was just a few hundred dollars on their regular monthly credit card that they paid off every month. And IIRC we paid the whole thing off anyway just because it was a valid debt and my Dad had the money to pay it.

The card also happened to be my Mom's card with my Dad as an AU. We discovered this later when we called in to make a change of some sort and the CC company asked to speak to the primary card holder. When they found out she had passed away, they immediately closed the account and turned the balance over to a collection agency. That made it a bit tricky for us to sort out but we eventually did.

If my Mom had been bankrupt and my Dad had told them to pound sand, I don't know if they would have been able to come after his assets.

:shrug:

 

[CardsFan]

So my wife's sister is married to a guy who has no spending self control. He has run up huge debts on his credit cards. Her name is on none of these cards. If he dies will she be responsible for these debts?
I'm of the opinion that she will be because they're married but thought I'd ask.

Just my 2 cents, but if this is a problem I think they need to address it before he passes (unless, of course, she has something in the works )