Dealing with credit-card debt when a spouse dies

A primer on spousal credit debt If your spouse dies and leaves behind credit-card debt, do you have to pay it?

Maybe, maybe not:

• If it's a joint credit-card account, you're responsible for the debt. "That's the nature of a joint account," said Nessa Feddis, vice president and senior counsel at the American Bankers Association.

Also, if your name is on the account, the card is on your credit report, said Bill Hardekopf, CEO of LowCards.com and author of "The Credit Card Guidebook: Understanding the Complex World of Credit Cards."

• If the account is in your spouse's name only, you may not be responsible. The debt belongs only to your deceased spouse, Hardekopf said. Family members aren't responsible for that debt.

• Your spouse's estate is responsible for paying the balance, unless there's no money in the estate. "If you die with debts and you have no assets, your debts die with you," Feddis said.

The credit-card company must write off your spouse's debt and the account is closed, Hardekopf said.

• In a community property state, you may or may not be responsible. Assets and debts gained together during marriage might both be classified as jointly held, Hardekopf said. In that case, the surviving spouse would have to pay up.

The community property states are Alaska, Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington and Wisconsin.

• The surviving spouse should expect calls from creditors and collection agencies. If there's money in the estate, they'll go after it and may even attempt to bully you for payment, Hardekopf warned.

. . .

Here are some things that you need to do if your spouse died and left behind credit-card debt:

• Get organized. It won't be easy while you're grieving. But hunt down all of your spouse's financial information, including debts, advises ClearPoint Credit Counseling Solutions based in western Henrico County.

• Consider contacting a reputable credit counselor. Find one that is an accredited member of the National Foundation for Credit Counseling at (800) 388-2227. A reputable credit counselor can help you get organized and work out a budget or debt-management plan.

• Notify all creditors that your account holding-spouse has died. Do it even if the account was only in your spouse's name, Hardekopf said. Find out where to send a copy of the death certificate, and include a note with the spouse's account number. Send it by certified mail so you'll have proof, and keep a copy of the correspondence.

• Don't answer questions from collectors until you know what debt you're responsible for. If you're not the executor, refer all questions to that person, Hardekopf said. If you're the executor, find out if the debt is even valid.

• You may need to seek legal counsel. If there's a dispute over your spouse's credit-card debts, get advice from an attorney who specializes in estates, wills and trusts, Hardekopf urged.

If you're liable for your spouse's debt, but you don't have the money, call the credit-card company immediately. Ask to work out a payment plan. The card issuer may even settle for a percentage of the debt owed.

Contact Iris Taylor at (804) 649-6349 or . Follow her on Twitter at http://twitter.com/RTDIrisTaylor.