What will happen to my debt after I die?
If you applied for credit in your own name but have any insurance in place, including PPI or life insurance, it may be that these will help to cover any debt which remains outstanding in the event of your death.
If, however, you took out a loan or other credit facility in joint names, then it is likely that any outstanding debt on that facility will be passed to your surviving partner.
Should your estate, after all tax has been paid, be valued in excess of the debt, then your debt is likely to be cleared from these funds. Your debts will be paid off in a strict order before any beneficiaries are given any money but if there remains a negative shortfall and some of your creditors can not be paid from your estate, they may agree to write the debt off.
With expensive care home fees and a high cost of living with lower income now playing a large part in today’s society, substantial debt after death is becoming commonplace. A payment protection plan can be set up to ensure that no debts are passed on after your death.