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Credit Card Debt Collection After Death: Is Calling Family Fair?

On Behalf of | Sep 24, 2010 | Credit Card Debt, Firm News

In part 1 of this series, we discussed the increasingly common practice among debt collectors of calling surviving relatives of deceased debtors in an attempt to persuade them to pay. In the vast majority of cases the relatives have no legal obligation to pay the debt. Nevertheless, banks and collection agencies say they simply have no other option but to call grieving relatives. Traditional legal processes are becoming less effective, they claim, even as the average credit card debt load is growing rapidly.

Today we’ll consider arguments on the other side.

Why Do Consumer Advocates Think Calls to Surviving Relatives Should Be Prohibited?

Consumer advocates respond that the number one reason debt collectors try to persuade grieving relatives to pay is simple: It works.

“What’s happening here is that we have people attempting to circumvent the formal legal process, by preying on the family that’s left behind,” said Prentiss Cox, a University of Minnesota law professor.

Collection firms try to bypass the probate process because they fear the estate will run out of money. Credit card debt is considered low priority — meaning that credit card debt is the least likely to be paid off in a limited estate.

Unscrupulous debt collectors may even present relatives with debts already discharged in bankruptcy on the chance that some will be paid.

Cox also argues that post-death collection calls to relatives are “by their very nature misleading” because they create the impression that the relative has an obligation to pay debts that aren’t theirs.

Other consumer advocates such as AARP elder law attorney Sally Hurme agree, saying that the calls rely on guilt, misinformation or grief to persuade people to pay. Particularly vulnerable are the elderly, who are often willing to pay off the debt just to get the creditor harassment to end.

At the very minimum, consumer advocates argue, debt collectors should have to tell family members that they have no legal obligation to pay the debt.

Do Post-Death Collection Calls to Relatives Break the Law?

A number of lawsuits are now underway across the country. Consumer and bankruptcy attorneys argue that collection calls to surviving relatives violate the Fair Debt Collection Practices Act, a federal law that prohibits consumer debt collectors from using deceitful or unduly aggressive tactics.

In one lawsuit, a widow accuses a collection agency of telling her she was legally responsible for all of her late husband’s debts, which was not true, and threatening to foreclose on her home, which they could not legally do.

In another case, the mother of a man who had committed suicide was hounded by creditors. Even though she truthfully told the collection agency she had no responsibility for her son’s debts and that his estate was too small to file in probate, the collection agency called her 45-50 times within the first four months after his death.

In some cases, collection calls to the deceased’s relatives have turned out to be scams. Some con men check obituaries, pose as debt collectors, and call relatives seeking personal information to use in identity theft.

It’s unclear yet whether courts will rule that calling a deceased debtor’s relative always violates the Fair Debt Collection Practices Act, or if the practice could be used fairly.

Whatever the courts decide, the practice is clearly outraging many people. “Not only did we give them billions of dollars in bailout money, but now they’re hiring goons to harass our brothers and sisters after we die,” states a Birmingham, Alabama, attorney involved in one of the lawsuits. “When does it end?”


  • “Death won’t stop these debt collectors” (Minneapolis Star Tribune, September 22, 2010)
  • “Paying the debts of a deceased relative: What you should know” (Minneapolis Star Tribune, September 22, 2010)

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