Loan canceled by suicide?

Question

My friend told me that loans are canceled only if the person dies a natural death and not when they take their own life. Is this true?

Btw, I'm talking about school loans, which I think are different than other types of loans.

Answer 1

Federal regulations state that a Federal Stafford and Perkins loans will be canceled if the borrower dies -- and, no, they don't specify a manner of death.

This "benefit" (for lack of a better term) is an excellent reason why a student should *never* consolidate his/her loans with a spouse. If this was to occur, then all their loans would be in both students' names and *both* would have to die in order for the loan to be canceled. If only one died, the other would be responsible for the repayment of the couple's entire loan volume.

If a parent borrows a PLUS loan and the student (on whose behalf it was borrowed) dies, the PLUS will also be forgiven.

Answer 2

Depends on the loan and what is in the contract, also what country's laws are invoked (I'll discuss the U.S. below)

Generally, the type of death does not matter so much as how the estate should be disposed. For instance, if a debtor dies with a mortgage, the lender can generally sieze the property, although if there is family living in the residence the lender should make efforts to try to continue the loan, or request that the residents (ie surviving family) seek alternative financing to pay off the debt to the lender. This is one reason for having life insurance on the house or auto - in case of death (NOT suicide), your debts can be paid off (or at least mitigated).

On the other hand, loans may be cancelled at the lender's discretion. Friends who worked in collections told me they would write off debts under certain circumstances (ie, on an auto loan the borrower totalled the collateral and died in the process; on a credit card there is only one borrower and he's in a coma or being prosecuted for a federal offense) or, very rarely, forgive them outright (meaning the person was alive and all but we're unable to pursue).

Regardless, the loan is still due, and collateral can still be siezed. In the rare event of an unsecured loan and a deceased borrower, the lender is last in line behind all the secured lenders, so often its best to just save the court fees and walk away.

Answer 3

Federal Stafford loan can be canceled if the student teaches at a Class 1 (low-income) school, becomes permanently and totally disabled, or dies. There is no stipulation where the student dies of natural causes, commits suicide, or is killed by some other means. Death is death is this regard.

Federal Perkins loans also have cancellation provisions, but they are to numerous to go into here. Check with the school's aid office for this information.

Answer 4

Niether eventuality cancels a loan. The deceased's estate is responsible for any unpaid debt left behind, and in most principalities, the dead person's heirs can be expected to retire the debt. I guarantee you, if the debt is large, the bondholder will go to court to demand payment from any heirs left behind - whether they inherited any substantial sums or not.

Answer 5

Have you ever wondered about the reason of our existence? Have you ever wondered why we die, and where we go after death? What will happen to us in the end? Have you ever asked yourself why God made the earth and all that is in it under man’s dominion? Why were the night and the day, and the sun and the moon created? What are we supposed to do during our lifetime? Were we created just to eat, drink, and enjoy ourselves before we die? As one poet put it:
“I do not know whence I have come.
I saw my feet walking on the road.
As they please I go and stop.
What am I doing here?
How did the road find me?
I do not know! I do not know! I do not know! ”

God has emphasized in many verses of the Qur’an that He did not create us without purpose. He said: “What! Do you think that I created you simply in jest? And that you would not be returned to Me?” (23:115) He also said: “What! Does man think that he will be left to roam at his will?” (75:36) In addition, He said: “Do people think that they will be left to say: “We believe,” and they will not be held accountable?” (29:2)
Indeed, God Has created human beings for a purpose and with a purpose: TO WORSHIP HIM ALONE (Monotheism). He said: “I have not created the Jinn and humankind except only to worship Me. I don't require provision or feeding from them. Surely Allah is the All-provider, the Possessor of all strength, the Firm.” (51:56-58) In fact, all prophets told their people to worship God alone (Monotheism) and shun worshipping His creation (Paganism). God said: “I assuredly sent among every people a messenger with the command: Worship Allah and avoid worshipping false gods.” (16:36)
Prophet Abraham, for example, believed in One God, who had no partner. Anyone who holds a different understanding of God than this has contradicted the religion of Abraham and follows falsehood. God says in the Qur’an: “Those who reject the religion of Abraham make fools of themselves.” (2:130)
Prophet Jesus was reported in the Gospels to have said: “It is written: ‘Worship the Lord your God and serve Him only’.” (Luke 4:8)
Prophet Jacob also said (in the Qur'an) to his people: “Indeed, those which you worship besides Allah are only names that you and your forefathers have established, for which Allah has sent down no authority. The command belongs only to Allah. He has commanded that you worship none but Him. That is the right religion, but most people do not understand.” (12:40)
Read more about the TRUE BELIEVE which supported by the Miracle Holy Quran :
http://www.islam-guide.com/islam-guide.pdf

http://www.harunyahya.com

http://muslimconverts.com

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Real happiness and peace can be ONLY found in submitting to the commands of the Creator and the Sustainer of this world. God has said in the Qur’an: (Truly, in remembering God do hearts find rest.)
(Qur’an, 13:28)

On the other hand, the one who turns away from the Qur’an will have a life of hardship in this world. God has said:
(But whoever turns away from the Qur’an, he will have a hard life, and We will raise him up blind on the Day of Judgment.) (Qur’an, 20:124)
This may explain why some people commit suicide while they enjoy the material comfort money can buy. For example, look at Cat Stevens (now Yusuf Islam), formerly a famous pop singer who used to earn sometimes more than $150,000 a night. After he converted to Islam, he found true happiness and peace, which he had not found in material success.
To read the stories of people who have converted to Islam, please visit

http://www.islam-guide.com/stories

At this web page, you can read the thoughts and feelings of these people, who are from different countries and have different backgrounds and levels of education.
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Answer 6

No. If you die, a notice is published in the newspaper so that creditors can send the estate a bill. The estate is then responsible for paying.

Answer 7

they can go after your estate natural or suicide

Answer 8

dear god, there are some days when there is just not enough liquor in the world...