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Estate Planning

If You Are In Debt When You Die

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Generally, someone's estate is responsible for paying their debts. But if there isn't enough in the estate to cover unsecured debts, they typically go unpaid. (Unsecured debts are debts such as credit card debts. The creditor does not have the right to sell specific property if the debt is not paid).  

Secured debts are a different matter. Usually the creditor has a right to look to the property securing the debt for repayment. If there is a difference between the amount of the debt and what the property brings on a sale, the difference is paid to the estate. 

A spouse may be liable for your debts.  Even a spouse's obligation to pay may be limited under state probate law. To determine whether you're legally obligated to pay, talk to an attorney who is knowledgeable about this area of the law.

Usually, no one else has a legal obligation to pay the debts of a deceased relative who was not a spouse.

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