What happens to credit card debt when someone dies?

What happens to credit card debt when someone dies?

Attorney Tom Olsen: Dave you're on News 96.5, go ahead.

Dave: Thank you. I was wondering if someone has credit card debt and dies unexpectedly, does that credit card debt vaporize or what happens to it.

Attorney Tom Olsen: It depends. Here's the answer to your question, Dave. If that person has a probate estate, if they have assets that need to go through probate, like bank accounts and real estate, et cetera. Whenever you do a probate estate, you must give notice to creditors. Creditors have an opportunity to file a claim. As you can imagine, in a probate estate before the beneficiaries get money, all creditors must be paid.

Now then, if there's no probate required, like let's say, it's a husband and wife, they own everything jointly and the husband had a bunch of credit card bills in his name only, now he passes away, everything automatically belongs to his wife. No probate required. Then that credit card company is not going to get paid.

Dave: Thank you, that's very helpful.

Attorney Tom Olsen: Okay Dave, you're very welcome. Chrissy, we are talking to people all the time about avoiding probate and we rarely touch on it, but in addition, when we were talking about avoiding probate, it's really about avoiding attorneys' fees but if you can avoid probate too, you can avoid having to pay your creditors when you pass away.

Chrissy Merrill: Exactly. People do not often realize that it's both.

Attorney Tom Olsen: Yes. All right good call Dave, we appreciate it.