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When I was in my late teens, my father died. He wasnt feeling well one evening so he went to bed early...and just never woke up. He left behind some debts that ended up in collections and before too long, collectors were calling our house on a semi-regular basis. My mother wasnt emotionally capable of taking these calls, and I was trying to take care of her the best way I knew how: by fielding away my fathers creditors. My story to any collection agencies that called was that my mother had packed her bags and left myself and my father three years prior and I had no idea where to find her. Once I even mustered up some fake sobs and asked the collection agent if he found her, would they please call and tell me? 

Long story short, I didnt have to give the collection agencies a lie when they called to collect after my fathers death. If I had a time machine, one of the things I would do is go back in time and give my young self instructions on how to handle this. I cant do that, but I can give those instructions to you. 

But first, the basics. 

When a person dies, that individuals estate goes into probate. The estate isnt limited to property the deceased owned, but encompasses all of his/her worldly assets (there are some exemptions that are not included in the estate, but they arent relevant for the purpose of this post). Its the creditors responsibility to file claims with the probate court against the estate within the time limit set by the state. At the end of the probate period, the court "settles" the estate by paying off creditors that filed legitimate, timely claims and turning the remainder of the deceaseds assets over to his heirs. 

Oftentimes, there are creditors that dont get paid. Those creditors, unwilling to do what theyre supposed to do and write off the account as a total and complete loss, "accidentally" sell that account to a collection agency. Thus, they get some scratch for the debt while simultaneously passing the buck to someone else. 

The natural course of events transpires and debt collectors begin calling the deceaseds house nonstop. The surviving family members inform the bill collectors that the debtor is dead, but the debt collectors dont believe that. The family might even send the collection agency a copy of the death certificate. Sometimes, this is the end of the story, but more often than not the dog and pony show is just beginning. 

First and foremost, debt collection is an industry with a high turnover rate. Agents dont stay at the job very long. Its just too disheartening and most people arent nasty enough – or desperate enough – to make that a long-term profession. Because of this, bill collectors rarely have the training and experience necessary to know all of the small ins and outs of collection law – especially when it comes to the deceased. 

To make matters worse, bill collectors work on commission. The more money they collect, the more money they make. This gives collectors who know better a strong incentive to toe the line of the law or even jump over it entirely. Most consumers know their basic rights, but have no idea how to handle debt collection activity after the death of a loved one. 

So the debt collector calls and demands that you pay the debt of your husband/sister/brother/grandparent and you say..what? Youve been put on the spot. You know nothing about this debt, but this person says you have no choice but to pay it. If the collector is particularly nasty, hell threaten to do something like sue you, garnish your wages, take your car and home or ruin your credit rating. If youre like many scared consumers, youre blinded by grief and confusion and you either promise to make a payment or worse – give the debt collector your banking information to allow the company to debit the money directly from your bank account. 

Heres the first thing you need to know. With few exceptions, you do not owe this debt.  Let me say that again for emphasis. YOU DO NOT OWE THIS DEBT. Got it? Good. 

The law is a grey area as to whether or not a bill collector who knows your loved one is dead can still call and ask you for payment. The Fair Debt Collection Practices Act makes it perfectly clear that collectors can only discuss the debt with the debtor, not a third party (in this case, you). But when the debtor is dead, the debt collectors almost always ignore this rule and, to the best of my knowledge, theres no case law on this yet. 

But one thing is painfully clear: a bill collector can never, ever threaten someone with legal action they cannot actually take. The collectors cannot lie to you in an effort to scare you into paying off your dead loved ones debts. Theyll do it without blinking an eye, but its illegal. 

(If youre curious about just how low collectors will go to collect the debts of the deceased, this New York Times article, Youre Dead? That Wont Stop the Debt Collector is both fascinating and cringe-worthy at the same time.)

When your phone starts ringing off the hook with calls from collectors wanting you to pay off the deceaseds accounts, your first course of action should be to inform the collector that the individual has passed away and ask for an address to send the death certificate to. Contrary to what you may believe, most debt collectors arent evil beings sent from the bowels of Hades to terrorize the living. Theyll give you the correct address and hang up the phone. So here we go, step by step:

In rare circumstances, family members can be liable for a deceased loved ones debts. Namely, if you were a joint account holder for the account or you live in a community property state that applies the community property rules to debt as well as assets. Thats important. Collection agencies and creditors alike would love for all consumers to believe that living in a community property state is enough to be saddled with their spouses debts upon their death but it simply isnt the case. All community property states treat debt after death differently, so know your states rules before you assume you have to pay your deceased family members collection debts after theyre gone. 

Send a Cease and Desist Letter to Debt Collectors 

Fighting Collection Agencies