What Happens To Credit Cards After Death

Information verified correct on December 1st, 2015
Find out whether or not your credit card debt follows you in to the grave Find out whether or not your credit card debt follows you in to the grave

What happens to your credit card debt after you die?

Although nobody really wants to think about what will happen to our loved ones when we die, when it comes to our finances it’s important to understand how any assets and debts we have will affect our nearest and dearest when we meet our maker.

One of the most common debts left behind, and the one that seems to trouble the public more than any other is credit card debt. What happens to your credit card debt when you die? Is it written off or will your family have to pick up the bill?

Let’s have a look at how you may be affected by your credit card debt when you die.

Debt After Death

Most of the time any personal debt that isn’t a secured debt, i.e. secured against an asset will not be the responsibility of your loved ones after you’re gone. What normally happens is that any estate or assets left behind will go towards paying the debt off, and what’s left will then be given to whoever is named in your will.

In cases where the debt is greater than any assets left behind sometimes, the credit card company will be forced to write off the debt as a loss. Of course companies do everything in their power to avoid such situations and it’s important your loved ones stay in close contact with your debtors as soon as they can after your death.

What they need to do immediately is to contact your credit card company and inform them you are deceased. At this point they should also ask that any interest rates be frozen so the debt doesn’t continue to grow.

Although the credit card companies aren’t obliged by law to meet your demands most of them will. In some cases they will make an offer to freeze or reduce interest if your loved ones pay the debt off within a short period of time. The credit card company will of course want to see written proof of your passing to protect themselves against fraud, and normally a copy of your death certificate will be acceptable.

What you need to let your family know is that their request to freeze your interest rate won’t have an adverse affect on their credit history in the same way as if a living person did it. It only affects the credit history of the person whose account and debt it is. Unless you plan on applying for credit from beyond the grave this shouldn’t really be of any concern.

Special Cases

There are some cases where those left behind will be liable for your credit card debt, and those cases are where you have had a joint account or co-signatory. Where your account has been joint, as soon as one of the account holders dies the remaining account holder will automatically become solely responsible for the debt.

This is prime reason why you should be very careful who you co-signature with, especially with a product where debts can become very large in a short space of time. If you do have a joint credit card make sure you are both fully aware of the credit limit and current balance so that if the unthinkable happens you will be prepared.

Credit Card Debt And Property

If you have a credit card account where the debt is secured against your property it’s important you let your family know. In the event of your death any outstanding debt will need to be paid off using proceeds from the property.

Because probate can often take a long time to come through it’s important your family gets in contact with the card company to arrange for a freeze on the interest, or else when your property is eventually sold they will be get a nasty surprise.

If your family is intending to keep your property they must take responsibility and pay off the debt within a certain period of time or the card company can take steps to recover their debt, forcing the sale of the property.

All of these rules can be different depending on where you live, and the type of credit card account you have. The real answer is to keep all credit card debts to a minimum so that if tragedy does happen to strike, you family won’t have too big a balance to worry about.

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26 Responses to What Happens To Credit Cards After Death

  1. Default Gravatar
    Kellie | November 9, 2015

    My father has a credit card that is in the name of a now registered company and he is a pensioner. Who is responsible for this debt?

    • Staff
      Jonathan | November 10, 2015

      Hi Kellie, thanks for your inquiry!

      If the credit card was registered under the company’s name then the company will be held responsible for the debt. The liable party will be the account owner of the card/ primary cardholder.



  2. Default Gravatar
    Sally | February 27, 2015

    My hubby has a credit card from ANZ ,what happens if he dies ? We have no big assets and we both pensioners ….Can you tell me how we can pay off the credit card faster ? Thanks

    • Staff
      Jonathan | March 2, 2015

      Hi Sally, thanks for your inquiry!

      Since a credit card is an unsecured debt it will not be the responsibility of any loved ones, unless the credit card is under a joint account. For more information on deceased credit card holders please see this page.



  3. Default Gravatar
    sharyn | February 5, 2015

    My mother has a credit card what happens to the balance when she dies do I have to pay it

    • Staff
      Jonathan | February 5, 2015

      Hi Sharyn,

      Thanks for your inquiry!

      Please see this page for a guide on what happens to credit cards after death.

      I hope this helps.



  4. Default Gravatar
    Krishnan | January 22, 2015

    My niece an Australian citizen and Indian origin lady in mid thirties with two kids of 7 and 9 years lost her husband a couple of months ago. At the time of his death he had a saving of around 2000 dollars in bank account and a credit card due of almost 18000 dollars. As estate he has only a car worth around 4000 dollars. Other than those only household items like sofa, fridge, washing machines and utensils are his assets. My niece got insurance from the superannuation fund based on a Letter of Administration of Supreme Court and the fund is now lying in a NAB Account on her name. What is the extent of liability of his wife and children towards the credit card dues? I understand that Insurance funds are protected from credit card dues. Is the Solicitor acting as an administrator take possession of the car and sell it without the consent of my niece. ?Kindly advise. Krishnan

    • Staff
      Jonathan | January 28, 2015

      Hi Krishnan,

      Thanks for your inquiry.

      Credit cards are an unsecured form of credit, the card provider shouldn’t chase a family member over a loved one’s credit card debt. There are some cases where those left behind will be liable for your credit card debt, and those cases are where you have had a joint account or co-signatory. Where your account has been joint, as soon as one of the account holders dies the remaining account holder will automatically become solely responsible for the debt. If the deceased’s estate is sold and their are not enough funds to pay unsecured creditors, the debt can go unpaid. The deceased’s family can not be held liable for these debts.

      I hope this helps.



    • Default Gravatar
      Krishnan | January 28, 2015

      Hi Jonathan,
      Thanks for the inputs on credit card recovery of the deceased and the extent of liability of the spouse this being an unsecured liability. Another fundamental question is, can the only asset of the deceased i.e an old car being used by is wife and her two young girls be taken away by the credit card company as a part f recovery of dues. She works in an office and has two daughters aged 7 and 12 years studying in two different schools, where this is their only mode of conveyance. Kindly clarify.

    • Staff
      Jonathan | February 3, 2015

      Hi Krishnan, thanks for your inquiry.

      Unless the debt has been secured against any assets, loved ones will not be held accountable for the debt. Please see this page for a guide on credit card debts after death.

      I hope this helps.



  5. Default Gravatar
    Josh | January 14, 2015


    My father died with debts on two credit cards. One with about $3000 owing on it and another with $13500 owing on it.

    After paying out funeral costs he has 3800 left over which will not cover all his debts.

    Do both banks just write this off? Or will the $3000 credit card need to be paid out first and the second written off?


    • Staff
      Jonathan | January 14, 2015

      Hi Josh,

      I am sorry to hear about your loss, thank you for your question.

      It is important to note that the credit card company should be contacted immediately and informed that a family member is deceased. Certain credit providers allow interest free payment options for a specified period if an eligible person takes over the account. The Credit Card terms and conditions of each credit provider will give guidance for managing deceased accounts with a contact number for further inquiry.

      In cases where the debt is greater than any assets left behind sometimes, the credit card company will be forced to write off the debt as a loss.
      There are some cases where those left behind will be liable for the credit card debt, and those cases are where there is a joint account or co-signatory. Where the account has been joint, as soon as one of the account holders dies the remaining account holder will automatically become solely responsible for the debt.

      I hope this has helped!



  6. Default Gravatar
    rick | January 2, 2015

    Hi my brothers wife has just passed , and she has left him with a credit card debt of more than $7000.00 , my brother has no assets , nor any money in the bank , he lives in a housing trust , and lives on a pension , is he responsible for the debt thank you

    • Staff
      Elizabeth | January 5, 2015

      Hi Rick,

      Thanks for your question.

      If his wife was the primary account-holder, any assets or property she directly owned (her estate) may be liable to pay off the debt. Your brother may want to seek legal advice to find out his responsibilities regarding this debt, and what, if any of it, he has to repay. There’s a free legal hotline for NSW that can be reached on 1300 888 529. If you’re from another state, you can search ‘legal aid (your state)’ to find the relevant number to call.

      I hope this will help.



  7. Default Gravatar
    Glen | December 11, 2014

    My brother died with 4k cash in a bank account and 11k c.c. debt and nothing else. now a funeral bill of 7k….does the executor get first go at the cash to pay funeral costs and then the cc provider would have to write off the debt provided the circumstances are exactly as stated.

    • Staff
      Elizabeth | December 11, 2014

      Hi Glen,

      Thanks for your question.

      The role of the executor is to decide how to distribute the funds, but usually the cash would be used to pay off any outstanding debts first. Property and other assets can also be sold to cover these debts. If you have further questions you may want to direct them to the executor of the estate as they will be distributing the funds.

      I hope this has helped.



  8. Default Gravatar
    Robbie | November 20, 2014

    How long after probate is completed can a credit card company demand payments that nobody knew existed

    • Staff
      Elizabeth | November 21, 2014

      Hi Robbie,

      Thanks for your question.

      There really is no one easy answer for this, because card providers could be attempting to chase up debt for a lengthy amount of time. You will usually receive a letter quite quickly after the fact, but if they fail to get in contact with you the process may be drawn out.

      I hope this has helped.



  9. Default Gravatar
    Bob | August 6, 2014

    Please consider this scenario. A couple with one of the partners owning a home in their name and also has credit card debt. The home owner has granted life interest for the remaining spouse through their Will. How would the financial institution deal with the deceased person’s unsecured credit card debt in this instance if there wasn’t any other assets to repay the loan?

    • Staff
      Shirley | August 7, 2014

      Hi Bob,

      Thanks for your question. finder.com.au is a comparison service, we allow you to compare factual information on a range of financial products.

      For any further information relating to specific account enquiries and issues, please speak to your bank, lawyer or relevant financial planner.

      All the best,

  10. Default Gravatar
    gary | December 1, 2013

    I have unsecured credit cards in my name only. If I die will my spouse have to pay them off?

    • Staff
      Jacob | December 2, 2013

      Hi Gary.

      Thanks for your question. In the event of your death, your spouse will not be responsible for paying off your credit card debt.


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