rik1471

And you owe the bank x amount of money but have no insurance, cover or other funds to pay does the debt get wiped off? If not, who's responsible for payment?

Jamo

iTrader: (23)

depends if you have a wife etc. generally if not and your single, its just written of as a loss, most banks account for this in some sort of way.

also good point to note is if you dont have direct life cover that you pay for, most employers offer death in service insurance where they will pay out to your next of kin, upto 4 times your gross annuall salary, they usually insure themselves for the loss of you as well, similar to a keyman insurance.

so your family would have some sort of moneys to clear any debts you may have.

hth

jamo

RayC

why worry you will be dead!!

or are you planning some kind of debt avoidance scam

Personally i have cover for the mortgage (necessary) and cover for my one loan, i also have death in service, so my lady stands to make quite a nice bonus if i croak (i'm watching my back!)

Brendan Hughes

Friend of mine always gets a bit peeved when he hears about how rich people are. His phrase is "When you think about it, would you prefer to die owning a million pounds, or owing a million pounds?" He certainly has a point!

chris's scooby

rik1471, it's illegal to fake your own death mate!

Not a bad idea though!!

Dracoro

I'm sure his kids don't think so

rik1471

just settling an office argument - not planning anything.

Diablo

The bank become a creditor in your estate (such as it may be) and are entitled to payment from whatever assets you have.

alcazar

iTrader: (2)

When my mother in law died, she had lived in council accomodation all her life, and after her funeral, there was about -£15 left!

We got final bills from electricity, gas etc, but sent them her death certificate, and details of the will ,and they just wrote it off.

Alcazar

Jerome

Does the death in service payment get included in your estate, ie any remaining debts get paid out of this payment before a girlfriend (named as the beneficiary of the payment) gets any money?

JFB

Well in my case my employer invited me to write a letter of wishes to the Trustees who will then distribute the Death in service benefit to my chosen beneficiaries in the proportions laid out in my letter. They are noy legally obliged to do so but it is very rarely rejected. That payment falls outside my estate for Inheritance Tax purposes. You can also do the same with life policies so that none of these "windfalls" come into your estate for IHT.

That's UK law though Jerome!

Cheers

Jerome

Jerome

Cheers, Jerome.

I have no intention of croaking just yet, but wondered if my gf would actually get anything if I did died with huge debt.

Having said that, all my debt is in the UK and any DIS benefits would come from a Canadian company.

judgejules

I'd probably die if I owed a million

I'd rather die with a million thanks, less stress leading up to it, I'm sure.

J

Diablo

Like JFB has said, if you create a trust or the benefits are already written in trust, the beneficiary should get them direct.

But basically your estate pays off your creditors before any payments are made to your beneficiaries (if your estate is being admnistered in the UK)

CrisPDuk

The trick is to have a debt so large that the banks worry about it Which then saves you needing to