10 May Deceased Person’s Loan Debt
What Happens To The Deceased’s Loan Debt?
If The Deceased Person Has Life Insurance For The Loan
First of all, it should be noted that one of the most important points on this issue is whether the deceased person has taken out life insurance while using the credit. This type of insurance is more important in long-term loans paid high sums, especially when using home loans. Life insurance, which we see as extra expense when using credit, becomes important in such a situation and the deceased person’s debt is paid by the insurance. However, in the absence of insurance, these debts are transferred to the person’s heirs.
In Case You Have Life Insurance
Life insurance is generally recommended to be taken out by banks, although loans are not required. This insurance is made in your use of any kind of credit regardless of housing, need or vehicle credit.
In fact, it would be the right choice for you to have life insurance. Because the main purpose of insurance is to pay your debts. So if someone who goes on loan debt loses their life, all of their debts are paid by the insurance company except in some exceptional circumstances.
These exceptions are:
Suicide in death of debtor, etc. insurance may not pay in case of a suspicious situation. In such a case, the insurance company may request an autopsy.
If the person who uses the credit has an existing illness at the time of taking out life insurance, but this disease is not mentioned in the policy, the insurance company will not pay if it determines that the disease is present in the person at the time.
Can the amount of credit Paid Through Life Insurance be withdrawn?
In the event that someone who has taken out a loan by taking out life insurance has passed away before the end of the installments, can the amount of the loan that he has paid be taken back?
The answer to that question can be taken Yes. Because life insurance is for the total debt of the loan. In this case, the amount paid by the deceased after the remaining debt has been paid must also be paid to his heirs.
But insurance companies can’t repay all or part of the “loan instalments paid” to heirs, citing additional contract clauses. In this case, rather than accepting what the insurance companies say, it is certainly helpful that you examine the insurance contract or consult an expert lawyer.
In order to receive this payment, you must make an application to the bank by one of the persons who is in probate with the death certificate of the deceased or by someone who is elected as a trustee. If the insurance company refuses to pay, you can seek your claim legally.
In The Absence Of Life Insurance
If a person who dies before the end of the loan debt has not taken out Life Insurance, his legal heirs must assume all debts. Because in inheritance cases, distribution is also valid for borrowing. If the heirs do not wish to repay the loan debt, they have the right to refuse the inheritance. In such a case, liability for the debts of the deceased will be eliminated. If the deceased person does not have life insurance and has shown a guarantor for the loan withdrew, then the guarantor shall be followed. If there is no guarantor, the way of collection is chosen from the heirs.
In other words, just as a deceased person’s property and receivables are transferred to their heirs, their debts are transferred in the same way. Therefore, it is important to make life insurance without seeing it as an unnecessary expense when using credit. If banks cannot come to a conclusion over their heirs and inheritance for debts resulting from the person’s death which normally takes place, the debt is assessed as the most recent sunken loan. In addition, if the cause of death is caused by natural disasters such as floods and earthquakes, the banks may be able to wipe out the debt completely in line with their policies.
What Happens To Credit Card Debt?
The same is true with credit cards as with loans. In other words, if the person who has passed away has life insurance, credit card debts are paid by the insurance company. In such a case, the amount to be paid by the insurance company is the amount of the amount of the guarantee stated in the policy. After payment of credit card debt is made over the amount of collateral, the remaining amount, if any, is transferred to the relatives of the deceased person.
What the deceased’s heirs should do is to go to the bank branch with the death certificate of the deceased’s relatives and have them question the debt situation. Then, if you find out if you have insurance, you should apply to the bank with documents. If the heirs do not wish to pay this debt, they may also be exempt from paying the credit card debt by making a redd-I inheritance.
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