Factoring Debt Into Your Estate Plan

In an exclusive interview with CreditCards.com, estate lawyer, Gary Altman, Esq./CFP, discusses what to do with joint credit cards upon death of a spouse.

Altman has always advised against having joint credit card accounts and even against spouses taking authorized user cards on each others' accounts.  "From an estate perspective, joint credit implies a 100 percent obligation of the surviving spouse for any debt remaining on a joint card. And if a spouse has access to a deceased spouse's account through an 'additional card' offer, the credit card issuer may try harder -- particularly in these times -- to see if that person can be made liable for any outstanding debt on the deceased's card."

Altman goes on to point out that in most states, the responsibility for paying off outstanding debt on a deceased's individual accounts falls to the deceased's estate.  And while this may not affect the surviving spouse's personal credit history, it can still tarnish joint assets.   "Depending on the state, there are guidelines on how creditors get paid. In Maryland, credit card companies need to file a claim against the estate within six months. While the executor is supposed to notify them, there's no legal requirement to do it."   Considering the current troubled economic climate, credit card issuers have gotten much better about combing death records and making claims against estates.  "I've seen a claim happen for as low as $132," said Altman.

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