Debt after Death

Introduction to debt and bereavement

Debt advisors can deal specifically with the following areas:

• Debt after death in the family
• Debt arising from the death of a partner.
• Debt incurred due to bereavement of a loved one,
• General money advice and budgeting following the death of a family member.

Debt after death of a loved one is more common than people think. This year alone the debt after death team have dealt with around 850 cases of debt arising from the death of a partner, relative or loved one.

The average cost of a funeral can be well over £1000. Many people can get into debt because they have insufficient funds to pay for funeral expenses so use credit as a last resort.

To avoid getting into debt after the death of a loved please note that most funerals have to be paid for prior to getting paid inheritance from a will. The following should be considered to avoid debt after death.

1. Has your loved one paid money into a savings plan specially to cover the funeral costs.
2. Does the deceased person have an amount of cleared funds put aside to cover the funeral expenses.
3. Is there a cremation society certificate.
4. Is there a life insurance policy to cover funeral expenses
5. Is there a prepaid funeral plan to pay for the funeral.
6. Is there a tin or secret place where your loved kept some cash to cover the costs of the funeral.

When you are faced by debt after death please note you can arrange a simple funeral to avoid getting into debt after death Clients should be aware of the following.

A 'Simple (basic) funeral' comprises:

• Making all necessary funeral arrangements and providing professional advice.
• Removal of the deceased to a suitable resting place allowing 10 running miles within normal working hours.
• Provision of a simple, veneered coffin and conveyance by hearse direct to a local cemetery or crematorium
• Providing the funeral director and all necessary staff.
• All necessary disbursements.

What help is offered to the public facing debt after death?

Our advisers are very caring and can offer allot of support through the difficult times surrounding debt after death. The advice team attend regular training sessions at care homes and with funeral directors and are totally up to date on the legal and financial matters following a death.

The debt after death unit is able to offer advice to people suffering from debt after death in the following ways:-

• Benefits Available to Surviving Parent, or Guardian
• Claims
• Compensation Awards
• Compensation Claims for Damages
• Criminal Trials
• Death of a Child
• Help with Funeral Payments
• Pensions, Tax and Benefits
• Welfare Benefits
• Who to Contact About the Will

The UK Insolvency Debt Advice Service advisers can be contacted on weekends and late at night offer advice to those suffering from debt after death. The debt advice provided will identify which debt solution is best.

Inheriting Debt after Death

Money Advice Direct debt after death team receive allot of calls from the public concerned about whether a deceased persons can pass on debts to surviving family members or relatives. A popular question the team receive is from children worried about inheriting debts from their parents after death. The debts of older family members are a very sensitive topic and poor communication within families can increase the fear of debt after death.

Please note that there are some special situations where surviving relatives or third parties can be responsible for debt after death these are the following:-

1. The debt was already a joint debt. Now that the other party is dead the full liability will remain with the remaining party.
2. A third party was guarantor of some debts of the deceased. Now that debtor is dead the full liability will vest with the guarantor.
3. Debts are to be paid from the estate of the dearly departed.

Common questions arising from debt after death are the following:

• Long and short term credit - how can debt after death affect my credit rating?
• How do I prevent debt after death from affecting my dependants?
• I don't want to become bankrupt. Can I prevent debt after death causing this?
• If I consolidate my debt after death, would that be a wise move?
• Now that we have the person has died, how do we share the debts after death and sort out the bank accounts?

Please note if you are unsure of a debt situation in any other special situation and you are unsure if you are responsible for debt after death please call 0800 074 6918. We have team of money, debt and credit advisers ready to provide advice on responsibility for debts after death.

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