Which debts are transfered to your spouse at death?
Assuming that your estate is insufficient to pay off your debts, which debts would become the responsibility of the spouse after death? Obviously I am not talking about joint debt (like a mortgage or jointly held credit cards). Rather, stuff like student loans. Also, I understand that this varies by state. However, I am interested to get a general idea for the U.S. Thanks.
Thanks for the responses (some more than others). Yes, we’ve got plenty o’ life insurance: enough to pay off ALL debts (mortgage, student loans, credit cards, etc.) plus a few hundred thousand to help the survivor take some time off, finish school (we are both grad students), and then get started in a career all the while paying for full-time childcare for our daughter. I was mostly just curious about the student loan thing … generally. Thanks.
As you state, it varies by state.
But I think you are going to find that upon death, the debts will go to the estate. An property in that estate will be sold to satisfy the debts.
Therefore, joint property could be in jeopardy.
I am not certain of this…Probate law is not my field of expertise….there are so many loopholes it takes someone who specializes in it to handle it.
I just know I’ve seen an awful of people have their lives destroyed when a spouse dies without having their business affairs taken care of. That’s why they recommend life insurance, to deal with these issues.
