Will I be liable for Mom's credit card debt if I am co-owner of her bank account, but not the cards?

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Will I be liable for Mom's credit card debt if I am co-owner of her bank account, but not the cards?

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I'm a co-owner / joint account holder on my 98 yo mother's checking account, and her POA. I pay her bills from this account. She also has 2 credit cards under only her name at the same bank. I pay the minimum due each month from the joint checking account. When she dies, will I have any liability for those credit card balances? Everything I read seems to indicate no. But, I want to make sure, as there will be nothing left to pay them with when she dies (all her income goes to AL facility). I don't want to be liable for her credit cards if I am a joint checking/ co-owner account holder. When I called bank today to verify I was a co-owner not just co-signer, they said there were no other accounts under my name, so definitely the credit cards are only under her name.

Debt Elder Law Financial Planning

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wicki100, just curious why you only pay the minimum due each month instead of paying in full. If there isn't enough in the bank account to pay in full, then time for Mom to give you back the credit card. Otherwise, with interest piling upon interest, over time what ever was purchased could now cost double.

You are not responsible for your Mom's debt, but her estate is. Thus, if there are assets in the estate, the Probate Judge will assign the required funds to the creditors.

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There is no money left.. Her very limited income goes to partially pay her AL and we pay the rest (children). I do understand debt very well. I paid all mine off 3 years ago. I was just asking about liability in this particular case. I wish I had the luxury to pay back in full. Not possible.

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No. You will not be personally liable to pay her credit card bills. If you contribute money into your joint bank account with her, that should stop immediately. Whe her estate is probated after she passes any institutions she owes money to will put in a claim to the estate to be paid. If there's a joint account with her name on it, that is considered part of her estate and they can collect payment. Keep the balance in that account as low as you can so when the time comes for probate, there won't be much for debtors or inheritors to go after.

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Thank you!

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Does your mother have Medicaid spending allowance? Her allowance pays her bill's. None of your money pays your mother's expenses on her credit cards. The State goes after her estate after she is gone.

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Her estate would be responsible for her credit card debt.

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Thank you so much for taking the time to reply. Yes, this is the consensus.

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My educated guess says no. However, read the fine print on the credit card agreement. Unfortunately, some questions are finally answered after the fact based on agreements we signed but misunderstood. An estate attorney may be able to decipher the agreement and give you a true answer based on your state and local laws. Should a bank pursue you after her death, if it were me I would not pay without challenging... even banks have employees who misunderstand all the legal rules for each individual case.

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Not sure why "we" you and your siblings are paying for the rest of her AL bill? That should stop. If she has limited income and assets and is 98 YO, Medicaid should be picking up her expenses! Yes, she'd be allowed to keep a small amount from her Social Security OR any retirement/annuity payment each month (like $80-90.00), but there is no real reason why all of you are spending your own funds (which you should be saving for your own needs, retirement, etc.).

Also, credit cards are "unsecured debts." Meaning if there is nothing left for the credit card company to get, there is nothing to get. Unlike a mortgage or car loan (both secured debts) the lender can take the home or car back. And as others have said, if the credit cards are in her name only, ONLY she OR her estate (whatever is left) they may be in line (but others may be in line before those credit cards; including your state Medicaid program if she is or gets on Medicaid).

And if not done, take away those credit cards NOW! There should be no more spending, pay the minimum and no more if you want or just do not pay. What will the creditor do, cancel the card, give her a bad credit score? So what at this point.

Finally, one thing if not done is if there are any funds, pre pay all funeral expenses as funds can be used for that and prepaid funeral expenses do NOT count towards any problem with qualifying for Medicaid.

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Not sure if this is true in all states, but where I live Medicaid does not cover AL, only skilled nursing homes.

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Good Morning,

Yes, I agree with freflyer can you pay off the amount each month. So there is no balance. That what's I do with my mother. We only buy what is needed. Between health insurance and family all of mother's needs are met but the credit card interest rates are going to sky rocket along with everything else. Or, perhaps can you call and see if they can settle for any amount--it may be looked at as a charge off but I would nip it now if you could.

How about if you check out "Matt Lesko" online, there are all kinds of help with grants and financial assistance for debt. Try 211 or Dept. of Elderly Affairs.

There are programs that can provide what your mother needs--Veteran's Aid & Attendance, prescription programs, in fact Mark Cuban just came out with a Low Cost online pharmacy.

I know it's hard to keep all of the balls in the air but you can't assume anything and who knew I would be paying double for chicken at the supermarket.

Look at everyone's answers and see what works for you. If you buy anything online you need a credit card since it's never a good idea to put your debit online in case of hackers.

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I appreciate you taking the time to reply. How we're paying off her debt is not a choice. Thank you though for taking the time to reply.

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It's my understanding that only the person whose name is on the card will be liable at death.

My two children just went through probate for their deceased dad's estate which was mostly debt.

It was in South Carolina. He had around $40,000 in credit card debt which the probate attorney advised them not to pay. The banks did not file a claim against the estate and they ended up not having to pay it back out of the estate.

Their dad did however have tax debt to both the IRS for about $30,000 and to South Carolina for about $28,000 and they did have to pay those from the estate. The tax debts don't get written off. Hopefully your mom doesn't owe debt to the government.

Hope that helps.

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Yes, thank you that is actually very helpful.

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In my personal experience you will not be personally responsible for any of her debt when she passes. Once her money is gone, it’s gone. If she has no house to sell or estate to settle the creditors don’t get their money. You are not responsible. What I would do is when she passes is take the death certificate to the bank and have her name removed from the bank account, or maybe do it now with your POA.

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Thank you so much, that's actually a good suggestion, though I actually just use the account for her bills, and I don't deposit anything in there nor do I pay any of my bills from there. We just added my name a few years ago to make it easier for me to manage it. Thank you!

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You'll need lots of copies of the death certificate from the funeral home. Notify the credit card company that she is deceased and offer to send a death certificate. No payments should be made after her passing. It's how I handled it with my father's passing.

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Thank you so much! This is exactly what I've heard from everyone and I just wanted confirmation. I so appreciate it.

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Her estate is responsible for it. If she has no money when she passes then the bill cannot be paid. You are not personally responsible for it.

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Thank you! That's been the consensus and that's exactly what I needed confirmation on.

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Ohwow is correct. Your mother's estate when she dies will serve to pay for her bills. That is to say whomever is executor will be paying your Mom's remaining bills out of your Mom's monies, the sale of any of Mom's assets and etc. and then distributing the rest of your Mom's monies as directed by her will. It is very muddy to keep an elder's money enmeshed to with child's money. Who is the taxpayer on this account? Who is the primary on it?
I would see an elder law attorney for your question. Normally when someone dies the credit card company can come after there assets. What will happen is anyone's guess. Normally also, a joint account becomes the account of the remaining live person upon the death of the other account owner. But you are currently paying bills for Mom out of this account. This may lead to questions. Again, I would take your question to an attorney. Your POA pays for this service. Be certain elder law attorney paid by the hour simply to answer some simple questions.

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Thank You so much for taking the time to reply. I think I've gotten the answers I've needed here and I'm pretty set. Thank you!

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I would get your mom on Medicaid to pay for her AL . Contact your county office of aged and disabilities for guidance.

answers to your questions below !

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Thank you, but Medicaid doesn't pay for assisted living, in general and the few facilities that would allow her to stay on just her income alone would not give her the medical care she needs. Her current facility provides a lot more medical care without being designated a nursing home. And my personal and extensive experience with Medicaid nursing homes has been absolutely horrifying, so as a family we've made the decision to sacrifice our own money for now for what we estimate will probably be only another 6 months to a year of life. (I hope!)

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I haven’t read the other answers, but I don’t think you’re liable for any credit card debt. My neighbor just went through that when his wife passed last year. Talk to your bank, they should say same thing. Kohl’s was trying to get me to pay for my sister’s debt.. I wasn’t even on her card (or on any of her accounts).

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Thank You so much for taking the time to reply. Yes, this is what I have heard from multiple people and my Google searches, I think I was just looking for reassurance. Thanks again!

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You should not be. That is her personal debt. Is that card tied to her banking account as a debt/credit card? If so, you might want to ask a lawyer in your state to be sure (if you are co-signer on her bank acct). Do you ever use the card or are you considered as a permissible user? I would ask for rules in your state.

Another consideration would be, will there be money left in the estate when she passes. The credit card company would have to file a claim against the estate to try to claim any outstanding balance.

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Thank you so much for taking the time to reply. She has no money left other than her monthly limited income, so the credit cards (not tight as a debit card to her account) will go unpaid. I'm a co-owner of the account but I only use it for her expenses, and have no desire to keep / use the limited money in it after she dies, because she will have left behind debt.

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wicki100: If your mother possesses zero money IN HER ESTATE after she passes away, credit card debt cannot be paid from a decedent.

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If you are not on the account with her credit card then NO you are not libel for her debt.
My Mom has a Trust Account. If you do not have one I'd suggest you investigate that option. It stops Probate Court from coming in after she passes.
My Mom too has a separate personal bank account with credit cards. Once I got POA I closed her personal checking account. We only have the Trust now. Mom was the Executor I got her to sign off so I was the Executor. That took her name off all banking accounts. She can not even go to the bank and ask questions now much less get on the phone and use the credit card to charge stuff. I would not suggest you leave her with an option to call and buy things. I was worried my Mom would give all her money to some TV Evangelist or donate to the Hope Ship as her Dementia has destroyed her short term memory. I could not take that chance & don't suggest anyone leave that door open with a family member who has memory loss due to Dementia.
A Trust account stops Probate from coming in upon death. What a probate court is looking for are availability to get Death Taxes from the assets. The probate court doesn't like investments. They like cash. So they will sell investment assets to get everything into a cash situation were by they can take their cut and the family airs can divide up what is left. A Trust Account stops that. Just FYI.

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I was the executor for my grandfather‘s trust. I know you don’t have a trust but I learned a few things that still may apply. Most notably, it is my understanding that most Credit card companies will not come after you for the credit card debt of a deceased person unless the amount is worth their time. My understanding is unless it was over $10,000 they would write it off. My grandfather‘s credit card was about $6000. Also after loved one passes away and the credit card company has been notified by the courts, the credit card company only has a certain amount of time to come and try to get the money. If they try after that the notification can just be ignored. That said I never heard from the credit card company.

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It’s a NOC Notice to Creditors that is done and it’s placed in a “publication of record” for that probate court jurisdiction. Can be the daily local paper but also can be a weekly publication. Gets done more than 1 time, how many and how far apart depending on your State. Will have the court docket # and name of executor &/or atty. It essentially places a time barr on claims so if no filing then not included in the debts of the estate filing.

Now if it secured debt, it’s my understanding that those run outside of NOC rules. Like if there’s a mortgage or car note, the contracts for those have the real property as collateral so outside of a debt to the estate. NOC is for unsecured debts. If yours is a Level of Claim by Class state for probate, Credit card debt could be way down on the list. Like for TX, it’s a class 8 claim, so everything in Class 1-7 have to be dealt with first before CC debt. So good luck on getting any of the distribution from whenever that part happens for an estate. Plus if the executor/ atty want to go all hard ball, they will do in chambers meetings with debtors and in order to continue to have your “place”, the CC will have to have their atty get their butts over to the meeting. They won’t bother.

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Have you considered taking your name off her bank account entirely? You can work with a bank to create a Transfer on Death (TOD). You can still sign checks but the money is considered solely hers. Perhaps a good banker can assist with your question.

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Will I be liable for Mom's credit card debt if I am co-owner of her bank account, but not the cards?

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