Can a creditor place a claim against the other assets?
Suppose the debt was in the husband’s name only and all his assets were in joint trust accounts that immediately shifted to the widow.
When you default on a unsecured loan, like a credit card, usually what happens is the creditor will persue you for around 6 months. Then they sell the debt. The debt collector then files a court document to get a judgement against you or your assets.
If you have nothing, you are known as “judgement proof.”
If the creditor dies, the credit card company or someone who buys the debt can put a claim on your assets, if any.
But an unsecured loan goes to the end of the line. In otherwords, everyone who loaned you money, and you used an item as collateral gets first crack at recovery.
The creditors can only go after the estate.
If you put something as POD (payable on death,) it immediately goes to that person and isn’t part of the estate.
IF you purposely shift debts to avoid this, supposing you know your wife has only a week to live, that’s fraud and if it’s found out, the court will reverse it and make it part of the state again.
Different laws vary in different states, regarding unsecured debt. Some judgments last as little as 3 years others extend up to 15 years.
In the old days banks used to scope obits and freeze accounts. I recall in 1976 when my mother died, she immediately went to the bank and withdrew almost all the money in my father’s account. The paper came out on Thursday and the account was frozen. But it didn’t have much in it.
My dad didn’t own anything so it was a non-issue, but banks when they were locally own were good for freezing accounts of dead people.
It depends. On the state laws, what the unsecured debt is, how big the debts are (i.e., worth pursuit?), and what is/can be in the estate. Spouses are generally obligated to pay medical bills and other “necessaries” for their now-deceased spouse. Credit card companies are generally limited to putting a claim on the estate. Some things go into the estate, some don’t. And as Markxxx said, if he transferred assets to avoid paying creditors, that’s fraudulent conveyance and it may be reversed and the assets applied to the debts. Please note the weasel words (generally, may) above, because, again, it depends. You may need to consult a probate lawyer in your jurisdiction.
IAAL but I am not your lawyer. I do not represent you or anyone else and I am probably not even licensed to practice where you are. This is not to be considered legal advice. It’s just common sense and general information from someone on an anonymous message board.
Your mother must have been a very active dead person.
Just make sure and keep her away from your brain.