Once your parents die, who takes responsibility for their debt?

Question

My father-in-law is dying of cancer, therefore racking up hospital bills. Who is responsible for their debt once my mother-in-law is gone?

Answer 1

Nobody, but all their assets must be used to satisfy the debt to the extent possible.

Answer 2

They are responsible for it--alive or gone. If they both pass away and they own their home, it will be put into probate. So will their other assets. The proceeds will be used to pay off their debt. The next of kin or whoever is designated by their will will receive the proceeds. If their assets do not cover the debt then it's a loss for the creditors. Your family is not responsible for their debt. That would be like your sister's creditors coming after you to pay off her bills. It doesn't work that way.

Answer 3

The responsibility falls upon the estate. The executor of the will is then responsible for dispursing assets against liabilities. In other words, sell off what is owned, and pay off who ever files against the estate with the proceeds. If there is a shortfall, the creditor may be offered so many cents on the dollar if anything at all

Answer 4

They are....even after death. In other words, their assets will need to stand as collateral for their debts.

Let's say they have a $100,000 in home equity and owe $25,000 to the hospital and credit cards. Before the title of the house can transfer to the kids, the executor of the estate will need to pay all the debts. This usually means the house is sold, the debt is paid and then the remaining cash is dispursed to the heirs.

Answer 5

Your parents are responsible, and their estate after they both die. Children have no responsibility for parrental debts, but they might lose their inheritance.

If serious money is involved, creditors have a potential claim against assets transferred before death as gifts or at low prices.
Don't sign anything for them.

Answer 6

after their estate is used up then no one is responsible for their debt. If they die and leave unpaid bills the creditors can take their entire estate if it takes it all to pay off. If it does not satisfy the debt the they loose whats owed.

Answer 7

Their estate (what is left of it) will be tapped....unless they gift their money to their kids at least 3 years before she dies.

You should consult a financial planner.

We are dealing with this right now with our family (my dad passed in Aug.) and since there are so many tax rules, it would be prudent to get all the paperwork lined up now while everyone is still around and can talk about the assets in the estate. Believe me, its not fun searching for everything when you aren't really sure where to start.

So sorry to hear about your father-in-law. I hope that his passing is peaceful.

Answer 8

My dad and mom are going through this kinda too. And I heard them saying that how it works is this. Their property is sold (if they have any) and whatever is left over property wise once teh dbet is settled, you get. But if they have no assets to sell, then the debts are basically... well... forgotten. You aren't responsible for the debts of your parents... at least from what I overheard. I hope i heard right!

Answer 9

Good question. As long as you DON"T sign any hospital/bills as person responsible it is one their Insurance company.

No one is unless they have signed that they are responsible.If they are buying a house, the Mortgage company will sell it for what they can. Anything left over will go to whomever your in-laws designate.

He/should be on, or try to get on SSI, Social Security, VA .

Answer 10

I think it depends on the state they live in but one a bill can only be collected for so many years... like 7 or something so... and hospital bills are not handled the same way the morgage or something would...

Answer 11

I would think the debt is paid from the remaining estate of your parents-in-law.

I doubt you have any responsibility.