Home > Credit 101 > What Happens to Your Credit When You Die?

Comments 0 Comments

What exactly does happen to your credit when you die? It’s certainly not an everyday question that comes up, but whether you’re dealing with the estate of a loved one, or you’re wondering for your own estate-planning purposes, it’s certainly an important one. It’s no minor detail to secure the credit details in the event of one’s death, as a person’s credit can still be vulnerable to identity theft and fraud.

When someone dies, all the creditors of the deceased need to be notified, as do the three major credit reporting agencies, Equifax, Experian and TransUnion. This responsibility falls to the executor of one’s estate. When contacting the credit reporting agencies, an executor of the estate should request that the credit file be flagged as “Deceased: Do not issue credit.”

The executor of the estate also must forward copies of the death certificate to creditors and credit reporting agencies. Be sure to send certified letters and keep copies of all correspondence regarding the deceased’s credit.

To check to whether there are any outstanding debts, the executor of the estate also may wish to request a copy of the deceased’s credit report.

Heirs & Debt

So what happens to your debt when you pass away? Well, if you jointly held debt with your spouse, for example, the joint account holder or co-signer on a credit account becomes solely responsible for the payment of the account.

When it comes to solo credit accounts, however, heirs are generally not responsible for them. However, there are exceptions.

In community property states (Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington, Wisconsin and, if you choose it, Alaska) one spouse may be liable for the debts of another, even if they didn’t agree to them or even know about them.

So in a community property state, a surviving spouse may be held accountable for the credit card debt of a spouse after he or she dies.

Many community property states do offer exceptions for education debts, unless the surviving spouse co-signed for the loan.

According to the U.S. government, federal education loans will be canceled once the borrower dies and the school or lender is sent a copy of the deceased’s death certificate. But lenders of private student loans may have different policies.

So it’s all the more important to be on the same page with your spouse on an ongoing basis about all outstanding debts, and know which ones you might end up being responsible for. And, of course, have a plan to pay them off if and when you need to.

Checking your own credit reports regularly can help you keep track of your own debts, as well as any of your spouse’s debts that are also in your name. You’re entitled to your free credit reports once a year through AnnualCreditReport.com. Another good habit to cultivate is checking your credit scores regularly, as a sort of snapshot of your credit. There are a number of ways to get your credit scores for free, including through Credit.com, where they are updated for you every 30 days.

More on Credit Reports & Credit Scores:

Image: iStock

Comments on articles and responses to those comments are not provided or commissioned by a bank advertiser. Responses have not been reviewed, approved or otherwise endorsed by a bank advertiser. It is not a bank advertiser's responsibility to ensure all posts and/or questions are answered.

Please note that our comments are moderated, so it may take a little time before you see them on the page. Thanks for your patience.

Credit.com receives compensation for the financial products and services advertised on this site if our users apply for and sign up for any of them.

Hello, Reader!

Thanks for checking out Credit.com. We hope you find the site and the journalism we produce useful. We wanted to take some time to tell you a bit about ourselves.

Our People

The Credit.com editorial team is staffed by a team of editors and reporters, each with many years of financial reporting experience. We’ve worked for places like the New York Times, American Banker, Frontline, TheStreet.com, Business Insider, ABC News, NBC News, CNBC and many others. We also employ a few freelancers and more than 50 contributors (these are typically subject matter experts from the worlds of finance, academia, politics, business and elsewhere).

Our Reporting

We take great pains to ensure that the articles, video and graphics you see on Credit.com are thoroughly reported and fact-checked. Each story is read by two separate editors, and we adhere to the highest editorial standards. We’re not perfect, however, and if you see something that you think is wrong, please email us at editorial team [at] credit [dot] com,

The Credit.com editorial team is committed to providing our readers and viewers with sound, well-reported and understandable information designed to inform and empower. We won’t tell you what to do. We will, however, do our best to explain the consequences of various actions, thereby arming you with the information you need to make decisions that are in your best interests. We also write about things relating to money and finance we think are interesting and want to share.

In addition to appearing on Credit.com, our articles are syndicated to dozens of other news sites. We have more than 100 partners, including MSN, ABC News, CBS News, Yahoo, Marketwatch, Scripps, Money Magazine and many others. This network operates similarly to the Associated Press or Reuters, except we focus almost exclusively on issues relating to personal finance. These are not advertorial or paid placements, rather we provide these articles to our partners in most cases for free. These relationships create more awareness of Credit.com in general and they result in more traffic to us as well.

Our Business Model

Credit.com’s journalism is largely supported by an e-commerce business model. Rather than rely on revenue from display ad impressions, Credit.com maintains a financial marketplace separate from its editorial pages. When someone navigates to those pages, and applies for a credit card, for example, Credit.com will get paid what is essentially a finder’s fee if that person ends up getting the card. That doesn’t mean, however, that our editorial decisions are informed by the products available in our marketplace. The editorial team chooses what to write about and how to write about it independently of the decisions and priorities of the business side of the company. In fact, we maintain a strict and important firewall between the editorial and business departments. Our mission as journalists is to serve the reader, not the advertiser. In that sense, we are no different from any other news organization that is supported by ad revenue.

Visitors to Credit.com are also able to register for a free Credit.com account, which gives them access to a tool called The Credit Report Card. This tool provides users with two free credit scores and a breakdown of the information in their Experian credit report, updated twice monthly. Again, this tool is entirely free, and we mention that frequently in our articles, because we think that it’s a good thing for users to have access to data like this. Separate from its educational value, there is also a business angle to the Credit Report Card. Registered users can be matched with products and services for which they are most likely to qualify. In other words, if you register and you find that your credit is less than stellar, Credit.com won’t recommend a high-end platinum credit card that requires an excellent credit score You’d likely get rejected, and that’s no good for you or Credit.com. You’d be no closer to getting a product you need, there’d be a wasted inquiry on your credit report, and Credit.com wouldn’t get paid. These are essentially what are commonly referred to as "targeted ads" in the world of the Internet. Despite all of this, however, even if you never apply for any product, the Credit Report Card will remain free, and none of this will impact how the editorial team reports on credit and credit scores.

Your Stories

Lastly, much of what we do is informed by our own experiences as well as the experiences of our readers. We want to tell your stories if you’re interested in sharing them. Please email us at story ideas [at] credit [dot] com with ideas or visit us on Facebook or Twitter.

Thanks for stopping by.

- The Credit.com Editorial Team