Almost 50 percent of all American adults carry credit card debt. In Louisiana, the average amount of credit card debt is about $5,800. Often, people die before they pay off their credit card balances. Your parent's credit card debt

If your parent died with a credit card balance and you and your siblings are your parent’s heirs, there is good news and bad news about how the credit card debt will be paid.

The Good News: You Won’t Pay Your Parent’s Credit Card Debts From Your Own Pocket

In most cases, you are not legally responsible for the debt of your parent even if your parent had more debt than can be repaid from your parent’s estate. Therefore, you will not have to pay any of your parent’s credit card debt from your own bank account, income, or assets as long as you were not a cosigner or joint credit card account holder with your parent.

The Bad News: Credit Card Debt Could Affect Your Inheritance

In most cases, the credit card companies will be paid before any heirs receive an inheritance. Any money that you withdraw from the bank or assets you take or sell from the estate may need to be repaid if the credit card company pursues its claim.

Generally, secured debts such as mortgages or car loans are paid first. After the estate pays secured creditors, the estate pays unsecured creditors such as credit card companies. If the estate has enough money to pay the credit card companies, the creditors are paid in full, and anything that is left is distributed according to the terms of your parent’s will or Louisiana’s laws of intestacy. However, if the estate does not have enough money to pay creditors, creditors may be paid a percentage of the outstanding debt in order of priority, and the heirs inherit nothing.

If your parent recently died with credit card debt, we encourage you to protect your inheritance. Contact our experienced Louisiana succession lawyers today to make sure your rights are protected.

 

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