Debt that dies with you

9 Jul 2023 · 0 min

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0:29

In this brief video, Jerry Taylor explains which common debts persist after a person’s death and which do not. He clarifies that mortgage debt remains the responsibility of any co‑borrower or the estate if the family takes over the home; medical and credit‑card debts are generally handled by the deceased’s estate, though credit‑card balances may be negotiable. The only debt that is automatically discharged upon the borrower’s death is a federal student loan, meaning it is the sole type of debt that “dies with you.” He concludes by encouraging older adults to pursue advanced degrees without fear of lingering loan obligations.

Your debt generally does not go away when you die, but there is one type of debt that disappears. It's not mortgage debt. If there's a co-borrower, they're responsible, or if your family wants to take over the home, they have to assume responsibility for the debt. It's not medical debt. Your estate will likely be responsible for that. And it's not credit card debt. Again, your estate will be responsible, but you probably can negotiate with them. So the debt that dies with you is federal student loans. So if you're in your 70s and you still want to get that PhD, have at it.