My daughter went for a loan.and was asked for her next of kin.in the event of her death they would be liable for the remainder of the loan.Is this right?
snoopdog221 Mon 10/11/08 22:00
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Not unless her next of kin was her husband, if this was the case, then yes he would be liable for the remainder of the loan. It is likely the loan company asked for next of kin, as a means of contact in the event of her death. Otherwise, if she is single, it is likely they would ask for a guarantor. Deciding to be guarantor for someone is not an easy decision, as in the event of default on the loan, or death, then the guarantor would also be liable for clearing loan.
Hope this helps.
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A husband wold NOT be liable for his wifes debts when she died unless it was a joint loan.
The debt would be paid from her estate, if she owned half a house then the debt would need to be paid from that so if the husband wanted to keep the house, he would probably pay the debt.
For someone renting a house with no assets, the spouse would not become liable for the debt.
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The spouse of a deceased is liable for the deceased's debts whether they have assets or not. The bailiffs soon come knocking!
However, NOK ie parents of single children are liable if the child has assets the debt can be drawn off.
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I think you will find that a spouse is most definately NOT liable for their other halfs debts unless they are in joint names. The bailiffs can knock but there is nothing they can do.
"Any debts become the liability of the relative's estate. If there are sufficient assets in the estate to settle the debt, then this is dealt with by the executors. Creditors may sometimes attempt to claim payment from a partner or relative of the deceased, particularly if they lived together, but if they cannot settle the debts, partners or relatives are not obliged to do so. However, there are several exceptions:
- Debts for which someone had a joint liability with the deceased. For example if a couple took out a personal loan together.
- A mortgage will remain on a property even if this passes to a new owner by inheritance (although it may be paid off by an insurance policy).
- For married couples there is joint liability for council tax. In the event of a spouse's death, the surviving partner remains liable for any arrears.
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When my dad died, he had an £1800 balance on a credit card, which the company wrote off.
If you take a loan out in your own name, then I think your next of kin is only liable if, as has been said, the loan was in joint names, or if they had stood as named guarantor (I think).
Chances are, if you die, your next of kin is the one who's going to be dealing with your affairs and finances. I guess the banks like to know who they're supposed to be dealing with.
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Question Author
Many thanks for your replys.My daughter lives in Rented accomadation with her boyfriend.And her son lives with me.They wanted her sons name or my name(Not as guarantor).I said NO.so they took her boyfriends name.
Needless to say I talked her out of getting the loan through this company.
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