After losing a loved one, the process of closing out his or her estate can be confusing — especially for those who have never done it before or who are unfamiliar with Louisiana probate laws. It is normal to have questions about how everything works and what one might be left responsible for. For example, some may be confused about who has to pay off their loved one's debt. Is this a burden surviving family members have to bear?
Generally, no. Beneficiaries of an estate do not inherit their loved one's debts unless a beneficiary is considered a joint owner of the debt. So, anyone who has co-signed on a loan, credit card or other forms of debt can be held responsible for meeting the payment terms. As Louisiana is a community property state, spouses are considered joint-owners of positive and negative assets and are responsible for their loved one's debts. This does not mean joint owners have to pay out of their own pockets.
While many people die with debt, many also have positive assets as well. Debts are typically paid by the estate. If there aren't enough assets to cover the debt in full, the joint owner -- if there is one -- will likely have to pay the remaining debt on his or her own. If there is no joint owner and there are not enough assets to repay what is owed, the debt is usually written off.
To some individuals, the handling of a loved one's debt may seem pretty straightforward, but to others, it may be as clear as mud. Those who would like assistance closing out an estate and making sure all the financial issues are appropriately addressed can turn to legal counsel for help. The probate process takes time, but with an experienced attorney in one's corner, it can be completed error-free in no time.