Off topic question

[PaulPierce34G]

If a single parent has unpaid credit card, student loan, car loan debt & dies, would the children inherit it? 

I'm asking because in regard to credit card debt, I am not an authorized user or joint on any of the accounts. B) The same holds for student loans/car loans.  The only thing I have with her is a joint checking account.  She currently doesn't own her own home, but when my grandparents die, she is probably going to receive the house which they currently rent out to her, so I guess that would count as an asset at that time.  Also, does insurance policy money count as an asset?

[indeedproceed]

My parents have been sayin I will inherit their debt since I was 12.

[Truck Lewis]

cant answer your whole question,,but student loan die with you..at least i know federal ones do

[PaulPierce34G]

In regard to student loans, some were federal/state loans & some were private. 

[PaulPierce34G]

I'm just curious because my mom basically has a crap load of credit card debt, some accounts I was tied to as a joint I found out, but I made her remove me from them.  In regard to school loans, she took out some loans, and I am on none of the loans which she is the primary borrower, and the same holds for car loans.

I read that if a person has unpaid debts at the time of their death, then their estate is first used as a means to pay off this.  I know a home can count as part of an estate, is insurance money part of it, as well?  And after the estate covers the debt, whatever is left over, gets disbursed among those left in the will.  Or if the etstae runs dry, and some debts are left unpaid, then the creditor basically has no choice but to discharge the debt.  Any validity or truth to this?  Am I missing something?  There's got to be at least 1 person on this forum who has an idea about this sort of thing.  I'm not worried about "getting my share" in my mom's will when she dies, I just don't want to be stuck with debt which I haven't personally accumulated. 

[angryguy77]

If there is no $ left in her estate after her death, then they cannot go after you. The lenders cannot go after you if your name is not on the accounts. If you are not an authorized user on her credit cards, then they cannont go after you. You cannot be held liable for debt that you didn't cause. As long as you are not on the contracts she signed when she opened the accounts, you should be safe.

[PaulPierce34G]

Thank you...TP

[Edgar]

they usually carry a death insurance
in every single loan

[Roy Hobbs]

This isn't my specialty, but generally, the creditors can't go after you personally unless you are tied to the debt in some way (i.e., a co-signor, etc.).  However, the creditors do, I believe, have the right to go after the estate, should there be any equity.  I think litigation against an estate is fairly rare, but the debtor has that legal right should they choose to pursue it.

My further understanding is that life insurance benefits to a named beneficiary aren't subject to probate proceedings, and thus can't be attached.

The only way I anticipate personal liability to you is if you do something illegal during the probate procedure (i.e., use your position as an executor to deprive creditors of what is theirs).  Again, though, I'm not a probate attorney, and this should all be taken as essentially an educated guess, rather than formal advice.

[PaulPierce34G]

Thanks to all the responses.  They were all pretty much what I had assumed, just needed an outside source's opinion.  Thank you.

[JSD]

Thanks to all the responses.  They were all pretty much what I had assumed, just needed an outside source's opinion.  Thank you.

Have you talked to your mother about your concerns? Is your mother terminally ill? (If so I am sincerely sorry). I only ask because I'm trying to gauge how concerned you should be about this... Maybe a loophole would be for your grandparents to leave the house to you as oppose to your mother because of her debt.?

[PaulPierce34G]

No, she is not terminally ill.  Let's just say my mom is very bad with money.  Basically, she has credit cards up the wazou, and she sent me to college by basically financing the entire education.  When I first started college a few years, I had no idea about the procedures for loans, this, that, the other.  She handled the process.  She took out loans in her name & put some in mine. I got a job out of college in August working for my brother in law's marketing firm in Woburn, MA. After I got my job, i took over my own personal credit cards.  I have 6 of them...but the worst part is, my mom basically would get credit cards for me..I had no clue I had some of these cards..in all honesty, I thought i had probably 2, no more than 3 of them.  I will admit I did go crazy on them from time to time back in school, but she would too use my cards, figuring since she has put money on them, she is entitled to use them and she tried to pay whatever she could, its just that, since I didn't have any concrete idea about the financial situation, i thought they were being paid. Anyways, as I said, I moved to Woburn, MA, took over paying my personal credit cards, and had to put them into a debt management program..I know that doesn't look good on my credit report, but its the only way I could keep up with this mess, in regards to the cards.  I have been paying my own personal school loans (Private & Federal for about 5 months now, since they came due).  So everything with the cards & my loans are ironing out.

I basically posted this topic because I had pulled up my credit report the other day.  I guess, once a year, you are entitled to a free credit report..and no not that freecreditreport.com thing, but a website called annualcreditreport.gov can hook you up with it.  Anywho, I pull it up, and I see the cards which i put into the debt management program, I see the loans from the private & federal organization..everything in that respect looks fine.  Then I see I had 3 student loans taken out via AES/Sovereign Bank in a total amount of 65-75,000 dollars, had another loan for 5,500 from a place called EdAmerica/EdFinancial, and was a joint on some of my mom's own personal credit cards.  So, obviously, I am mad, anxious, all of that.  I'm only 24 years old, and basically have a total debt where I could've bought a cheap house.  I called the EdAmerica/EdFinancial (school loan) place & they sent me the promissory note via E-mail, I saw the pdf file & the signature/handwriting was not mine.  I could tell it was my mom's handwriting & she had signed my name to the loan form. The AES/Sovereign Bank loans, she signed my name to them, as she did the EdFinancial/EdAmerica... I talked about my mom with, she keeps telling me "Oh everything is going to be okay because when grandma & papa die, this house is mine, then im going to take a loan out on the house, and use the house as collarteral, & ill pay everything off." but I don't want things to work like that...Then she tells me, "and when I die, this house is going to be yours, and i'm leaving you a ton of insurance money, so whatever debts you may have will be taken care of."  My mom is 57, I don't think she is going anywhere anytime soon, and I personally don't want to have financial freedom when I am pushing 60 because I had to wait for my mother to die.  I understand there are always bills in life, but I don't want to be buried, I don't want to have huge loans following my butt around, not unless its a home loan..I mean, who would give me a legit car loan, mortgage, etc, if they see I have loans from various companies (both loans I personally took out & ones my mom forged) totalling ~100K? 

So last night, after a lot of arguing, I basically got her to call the credit cards & she removed me as an authorized/joint user from them...I don't want any part of that crap.  Then she said she called AES/Sovereign Bank, explained to them that she wants to put the loans in her name.  Supposedly they are sending me a package in a week or 2 that will contain paperwork that will basically be letting me sign those loans over to her & take my name off of them...I hope that's true.  I'm going to go through everything again this weekend, see if i missed any cards I may be affiliated with via her, any other loans, and get the crap taken care of.  Basically, I just want to be held responsible for my own credit cards & the loans that are rightfully mine...not cards I was put on without knowledge & not loans that someone else signed my name...Its my mom, I love her, and she has taken care of me all my life, she really is a good woman, but this is really messed up.  and its not an excuse "ive done so much for you in life" that can merit actgions such as this..

[JSD]

What was your major in college? Wasn't a large majority of the debt an inverstment in you? You're working in Woburn, do you still live with your mother?

I'm not trying to be a jerk but you sound a little selfish... I mean, welcome to your mid-20's... live at home, within your means and pay off your loans/investment.

[PaulPierce34G]

Yes, welcome to my mid-20's & no I dont live with my mom, I live with my sister for the time being, she and her husband own their own firm in Woburn.  I pay my own bills, my own loans, my own credit cards. I don't think it can get too much more mid 20's that that.  And i'm not trying to sound like a jerk myself, I know my mom had good intentions, but forging my name on things I had absolutely no idea about, putting me on cards attached to her name when she isn't making payments from time to time, thus affecting my credit too. So, I guess its okay for parents to put their kids' names on things, things that can really have an affect on a credit future for the next 15-25 years, as long as intentions are good? I'd like to be able to buy a home say in 10 years, have a decent car, not have to worry about 75 grand strapped to my back for which I didnt sign.   And just because they say student loan on my credit report, all the money didnt go towards my education, she has told me she took out a "student loan" from Sovereign Bank, in my name, claimed it was for my college...all you've gotta do is show the bank proof of enrollment & they will assume that's what its for, they dont personally send the money to the school, they send it to you, and you are to send it to the school..So she gets the money, and uses it for other things, not the school...I don't think my cause for concern is anywhere near selfish, I think its valid, as I'm thinking long term.  Being selfish would be saying "I dont want to pay any of my debt." No...I want to pay my debt, and my debt alone...that is credit cards which I fully knew I had, and willingly charged on, student loans I willingly & knowingly took out myself & physically signed my name to, because as I said, even though the intentions were good, it has caused a lot of nonsense, and I was very misled..  I shouldn't have to pay 75,000 dollars which I personally didn't sign for, which someone forged my name, as I have proof via a promissory note for one of the loans.  Whether the money was used for my school, and some other means, that is still fraud. I'm obviously not going to put my mom in jail or pursue anything legally, as I'm sure there are means to get around this stuff, and try to put names on & take names off.     

[JSD]

Yeah, it sounds like your mother might not understand the ramifications of a poor credit score. I didn't realize she was requesting title 4 and private loans be sent to her and not directly to the school.... not a good idea unless the extra doe is federally supported. (which title 4 would be, not the PL)

It sounds like you are taking all the necessary steps to remove yourself from the problem. You and your sister should help get your mom get organized with her financial situation... that's scary.