‘She has no life insurance, savings or money’: My brother died, leaving his wife with $20,000 in debt. How can I help her?

Dear Quentin,

My sister’s husband died last week. Both had lived with us for the past nine years before moving into independent living facilities. They were there for two and a half months before he died unexpectedly. He left her with $ 20,000 worth of debt. Besides selling his car – since it doesn’t drive – I don’t know how to pay off her debts.

She receives $ 1,600 a month in Social Security disability. She’s on Medicaid and Medicare. She has no life insurance or savings. She now lives with my husband and me. She has dementia. She needs 24-hour care. I have their power of attorney. Any advice on how to pay off your debt? It’s a bit overwhelming and I feel the need to start somewhere.

Concerned sister-in-law

Dear Concerned,

It may be that this guilt died with your brother. If there are no co-signers for these debts, they are usually deleted. If your sister-in-law was not listed on those shared bank or credit card accounts, or on personal loans for their vehicle, she is likely not responsible for the debt. Notify financial institutions of your brother’s death.

It is also important where your sister-in-law lives. Debt has been incurred in several jointly owned states – Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington, and Wisconsin while marriage is considered a “communal” responsibility. This means that both spouses are liable for these debts.

But, according to the Consumer Financial Protection Bureau, “In most cases, you are not responsible for paying off your late spouse’s debt. In principle, no one else is obliged to pay a deceased person’s debts. There are some exceptions and the exceptions vary depending on the state. “

“Unless there is an exception, you are not liable for the debts of the deceased. You are not required to do so, and the creditor or debt collection agent must not mislead you into taking responsibility through unfair, fraudulent or abusive practices, ”adds the CFPB. You can read more about this here.

Contact the top three credit reporting agencies – Experian EXPGY,
+ 0.27%,
TransUnion-TRU,
+ 1.76%
and Equifax EFX,
+ 0.53%
– with your brother’s obituary, and his credit report is flagged to say he has passed away. It will also prevent anyone from attempting to borrow on your brother’s behalf.

This is an unusual situation. Inform any creditors that your sister-in-law suffers from dementia and has no income or assets. The US Treasury Department garnishes a person’s Social Security only for federal loans, unpaid child support, and / or unpaid taxes owed to the Internal Revenue Service.

Focus on making this time as comfortable as possible for her.

Meyou can send The Moneyist to qfottrell@marketwatch.com with all financial and ethical questions related to the coronavirus and follow Quentin Fottrell on Tweet.

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• “Our friends always longed for a relationship like ours”: My husband, for 16 years, left me for another man. I don’t want them to live on our property. What can I do?

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