If a corporation can be disolved and stiff people, I see no moral reason why a real human stiff can’t either.
I don’t think it is moral for the CC companies to expect any payment after death. That is why it is called UNsecured debt. The house is different because the house is the security.
If you feel you must, then pay them back after you sell the house. You are just lucky that you live in MD and the state has at least one law between you and the credit card company.
So is it immoral to charge 29% interest? Morally, am I required to submit to an immoral practice, just because I legally agreed to it?
And the company legally agreed that if you die and they don’t notice for six months, they won’t make a claim against your estate. Now, they may have been compelled to make that agreement based on state law, but they could have decided not to do business in Maryland.
Exactly.
And if it were worthwhile, they’d be pulling death certificates (which are a matter of public record) and checking them against their client list and filing claims against the estate. Apparently, this technique doesn’t have ROI, so they don’t do it.
Although one correction, the money isn’t yours. It is the estates until the estate is settled. Debts get paid before heirs. However, I don’t see you under any obligation to let the credit card company know.
I have to say I am surprised at the view of morality expressed here. Given the original theme of the OP, I would have thought the question that would have determined whether you morally should have to pay back the debt would be - did she accrue the debt? To whom it is owed, what the legal ruling on it being owed back etc I don’t think has a bearing on whether you should pay it back. It was genuinely accrued, and should be paid back.
I’m with you GFM, it’s disappointing to find so many people saying that it is moral to default on a known debt, as long as it’s legal to do so.
There is no honor in paying back your debts when legally compelled to. What you do when the law doesn’t force your hand defines whether or not you’re a moral being.
I’m actually kind of surprised by this. Does your attorney specialize in this sort of thing? Wouldn’t the credit card company become kind of suspicious when they see the checks have Estate of ______________ written on them?
I don’t know what “ROI” means, but I used to live next door to a lady that worked for a bank (NCNB-now BOA) and (one of) her job(s) was to check the obituaries in the local paper to see if any of their customers had died. Don’t assume that the bank will not find out one way or another before you act.
One point of clarification; the debt is the decedent’s, not Edward’s. He owes nothing to the companies at issue. I suspect that most people would agree that debts are personal responsibilities, and that strangers to the debt bear no responsibility for repaying said debts.
Having said that, I have not seen anyone in this thread advocating “default[ing] on a known debt.” Rather, the general thrust of the comments has been that if the companies holding the debt put a valid claim in to the estate, as permitted by law, they ought to be paid. If they do not do so (for whatever reason), Edward is under no obligation to pay that debt. Indeed, should he decide to do so, perhaps because he sides with you and believes he has a moral obligation to pay the debts of another, he emphatically could not do so with estate funds. He has a legal and ethical responsibility to the estate and to the other beneficiaries. If he were to spend estate funds to pay off company that had made no valid claim on the debt, he would be exceeding his authority as executor. Therefore, should he decide to pay the debt, he must do so out of his own pocket.
The OP is rather factually specific. And under the facts given, I don’t see a moral obligation to pay a debt to the detriment of the estate and the beneficiaries if the creditor fails to make a claim for that debt. Indeed, the moral position is to pay only those debts as to which valid claims are made. To do otherwise is to cheat other creditors.
Not advocating Edward should repay the debt with his own money. The money he would be repaying the debt back with is from the estate.
And people have been advocating avoidance of the debt - when suggesting to keep quiet about the debt and waiting to see if the CC company notices:
That’s not being honest about the situation.
No, in my view the debt is known, it was acrrued by his mother, and as a debt to the estate it should be paid back by the estate. The legal loopholes are irrelevant when considering whether morally this debt should be repaid.
This is exactly the same reasoning used by people at the credit card company when they charge usurous rates to customers who pay a day late. “Our responsibility is to the shareholders, not you.” I guess that makes them moral beings too, as long as they try and squeeze as much dough out of you as they legally can. Those telemarketers that convince sad old people to spend money on crap they don’t need? Moral, since they were hired to sell stuff, not to make sure old folks have enough money for food. That used car salesman who sold a Doper a car that he knew would break down after a few miles? Moral, his job is to sell cars, not to make sure everybody has quality transportation.
Does the word Moral even have meaning under this reasoning? Is there right and wrong, or is my lawyer now my conscience?
The actions of others do not justify immoral behavior on your own part. The estate owes money to legitimate creditors. The estate ought to pay them back. The honest policy is to write to the creditors, inform of the situation, and tell them they’ll be paid with the proceeds of the sale of the house.
That’s the point: it’s the estate’s money, not the OP’s, and it would be wrong for him to decide on his own to use the estate’s money to pay these creditors in the absence of a valid claim as outlined by law.
If the creditors file a claim, absolutely he should pay them. If they don’t, the estate does not legitimately owe them the money, and paying these bills would effectively be stealing from the heirs.
The moral thing for the OP to do is to diligently carry out his duties as executor.
Nonsense. The estate legitimately owes them money if his mother borrowed money from them before dying. The estate may not be legally required to pay it back, but that debt is as legit as any other debt in existance.
If I borrow $20 bucks from you because I’m short, is that not a legitimate debt? You’ll never get legal enforcement of the debt, but that doesn’t mean I didn’t borrow, and it doesn’t mean I don’t owe you.
Agreed. And to the extent that my prior post was inconsistent with the following, I hereby retract the prior post.
As the executor, Edward’s primary duty is to the estate. If he is aware of a creditor, he ought to see that the creditor is repaid. Moreover, if the creditor makes a claim against the estate, generally the creditor has no right to immediate payment, but instead must wait for the estate to be paid out. Therefore, my earlier concern – that paying the credit card companies would mean that the other creditors would not get paid – is moot. If there is no legal bar to notifying the credit card companies of the death, and the companies have no ability to force an early payout that would waste the estate (or they are amenable to a negotiated settlement), then I agree that the executor ought to pay them.
In hindsight, I was wrong to say that an executor has a duty to the beneficiaries. I believe the executor’s duty is to the estate. So notifying the credit card companies of the death and arranging for their payment when the estate closes works for me.
Cheesesteak and Girl From Mars raised some interesting points. I don’t agree with all of them, but I could live with the above scenario.
Wait, wait, wait. I thought credit-card debt was cancelled on the cardholder’s death. Am I wrong?
I think this is the best idea. The house payments still have to made. It makes no sense to default on the mortgage loan when the house is worth more than the credit card debt. I will have to say if you have to ask the question, you know you “morally” should pay the debt. Omission of facts is still a lie, so saying that the companies should be responsible to find out about the death is ingenuous at best.
But to be perfectly honest I think this is a 100% a business matter and not a moral one. In a society that exempt charitable donations it is hard to justify paying off a debt that you can legally get out of. It is probably best to call the companies directly and work out a deal, maybe pay a small amount on each until the matter of the estate is finished.
While the usurous nature of credit companies should not necessarily determine what you feel is right, I think it is noteworthy to realize that they do not give a rat’s ass about your circumstances. I say “morally” you should stiff them since they tend to prey on the people that they know cannot make payments (i.e. college students) and then jack up the interest one day after a payment is not paid. Twenty-nine percent interest? Come on. I am seriously morally opposed to credit card companies’ practice and refuse to apply for any.
So I have some more answers to my questions. I must find the companies, in my case the credit card companies, and mail them a copy of the death notice in the paper. After that it is up to them to go to the court and file the proper papers. The best reason I can come up with is to keep someone from finding out my mother died, then years later try coming after me.
So what my lawyer told me to do is not what I should be doing. One would think that a lawyer in his field should know what to do, but then again maybe his normal clients don’t die with much debt. I will have to inform him of this.
However, this still leaves the question if they do not respond in time does the estate still have to pay? If so, is there ever a cut off? What happens if in ten years someone tries to come after me? Twenty?