Credit Card Debt After Death: Who Is Responsible?

Credit card debt is one of the most common financial liabilities executors encounter when administering an estate. It is also one of the most misunderstood — creditors sometimes pursue family members who have no legal obligation to pay, and families sometimes pay debts they are not required to. Understanding the rules clearly is essential to protect both the estate and surviving relatives.

Sole credit card debt is an estate liability, not a family liability

Under English law, debt does not pass to family members on death. When a person dies, their outstanding debts become liabilities of their estate. The executor's job is to pay those debts from the estate assets before distributing anything to beneficiaries.

This means that if the estate has sufficient assets, the credit card debt must be paid. But if a beneficiary receives less inheritance than expected because debts reduced the estate, that is not a debt the beneficiary personally owes — the debt is simply absorbed by the estate.

Critically, if a creditor contacts you as a family member and attempts to hold you personally responsible for the deceased's sole credit card debt, this is unlawful unless you personally signed a credit agreement. You can report such conduct to the Financial Ombudsman Service or the Financial Conduct Authority.

The exception: additional cardholders and joint credit agreements

There is an important exception to the "family not liable" rule. If another person was a joint holder of the credit card — meaning they signed the original credit agreement as a co-applicant — they are jointly liable for the outstanding balance and the debt does not die with the primary cardholder.

This is different from being an authorised additional cardholder. Many credit card holders add family members as additional cardholders who can use the card, but who did not sign the credit agreement and have no legal obligation to repay the debt.

To find out whether you are jointly liable, check the original credit agreement. If you signed as a co-applicant or joint account holder, you are liable. If you were simply added as an additional cardholder without signing a credit agreement, you are not.

If you are jointly liable, notify the credit card company of the death immediately and discuss how the outstanding balance will be managed. You may be entitled to payment holidays or forbearance arrangements given the bereavement.

How to notify the credit card company and freeze the account

As executor, one of your first actions should be to contact each credit card company to notify them of the death and freeze the account. This prevents unauthorised use and stops interest and charges from continuing to accrue on the account.

Most major credit card companies have dedicated bereavement teams. You can usually notify them by:

• Calling the number on the back of the card and asking to be transferred to the bereavement team
• Using the Death Notification Service (deathnotificationservice.co.uk) to notify multiple financial institutions simultaneously
• Writing to the card company's bereavement address with a certified copy of the death certificate

When you contact the credit card company, they should:

• Freeze the account to prevent further transactions
• Stop charging interest (though this varies by lender)
• Provide a statement of the outstanding balance at the date of death
• Confirm the process for settling the debt from the estate

What happens when the estate cannot cover the debt

If the estate's assets are insufficient to cover all debts — including credit card balances — the estate is described as insolvent. In an insolvent estate, there is a strict priority order for paying debts:

• First priority: Funeral expenses and costs of estate administration
• Second priority: Secured debts (mortgages and other debts secured on assets)
• Third priority: Preferential debts (certain employee-related claims)
• Fourth priority: Unsecured debts, including credit card balances (paid proportionally if insufficient funds)
• Last priority: Interest on unsecured debts

Credit card debt is an unsecured debt and sits fourth in the priority order. If the estate runs out of money before all unsecured creditors are paid, the remaining debt is written off. Beneficiaries receive nothing but are also not personally liable for any shortfall.

Many credit card companies will write off small balances as a goodwill gesture when a customer dies, particularly where the estate is small. It is worth asking the bereavement team whether this is possible in your case.

Time limits for creditors to make claims against the estate

Under the Limitation Act 1980, most unsecured creditors have six years from the date the debt became due to pursue a claim. This does not mean you should ignore creditors for six years — the executor's duty is to identify and pay legitimate debts promptly as part of the estate administration.

In practice, there are important steps executors should take to protect themselves against unknown creditors:

• Statutory advertisement: Place a notice in The London Gazette (and a local newspaper) under Section 27 of the Trustee Act 1925, giving creditors at least two months to come forward. Once this period expires, executors who have distributed the estate in good faith are protected from personal liability.
• Credit reference check: Obtain a credit report for the deceased (using their name and last known address) to identify any credit card accounts or loans that may not be apparent from their paperwork.
• Bank statements review: Check the last 12 months of bank statements for regular minimum payment transactions that would indicate active credit card accounts.

Do not distribute the estate to beneficiaries before settling or making appropriate provision for all known debts. Executors who distribute the estate and leave creditors unpaid can be held personally liable for the shortfall.

Payment protection insurance on credit cards

Some credit card holders took out payment protection insurance (PPI) alongside their credit card, which can cover the outstanding balance on death. Check the original credit card documents or statements for any indication of PPI or similar insurance coverage.

While most historic PPI mis-selling claims have now been settled, some policies remain valid and will cover the outstanding balance. Contact the credit card company and ask whether a PPI policy is attached to the account, even if you cannot find documents — the company will have records.