What Happens to Credit Score After Death
Have you wondered what happens to your credit score once you are gone? Have you ever thought about the hassles your family might have to go through once you are no more? You must ponder over on the topic of your finances and what happens to your credit when you die. Your family may need to take care of several financial issues, get your credit report and locate the active credit accounts or handle any debts.
Get guidance from experts like Sunlife for what else you might need to consider when someone dies.
Your credit report
The major credit agencies need to be notified about the death, and they will add a record to the file of the deceased person. This is essential to prevent any fraudsters from stealing the deceased’s details and get credit in their name. It is essential to notifying about the death so as to avoid any possibility of fraud. The credit report is an essential record of credit agreements and any outstanding liabilities. Only the authorized person should have access to the file.
The credit report is essential as there can be different types of liability that need to be dealt with differently. It can be challenging to sort fout the financial affairs. Thus, it is essential to find out what credit agreements are on the report and if there are any joint liabilities with someone else. Thus, one should always keep their credit scores and records updated on a regular basis. Review your credit report on a regular basis as you never know when a sudden dramatic event could change your scores.
The debts one leaves behind when they die can eat up their major assets. In some cases, sometimes the family members are also hooked on for the debt. Thus, it is best to get rid of any debts while you are alive and avoid leaving anything behind that could harm your credit score or be a liability for your family. You would of course not want your loved ones to deal with any debt and expenses.
The executor of the estate often deals with your will and estate after the death. The deceased person may carry a mortgage or any other type of credit agreements Their credit report carries the information. Typically, all accounts of the deceased are deleted after one year. A deceased indicator is applied to the credit report that indicates that the person has died. In case there is no will, and the state executor does not want to act, the next of kin can act as ‘administrator.’
In most cases, the creditors are not allowed to hold anyone else responsible for the debts left behind. However, there can be exemptions, especially if the family members have or co-signed or have a joint account with the deceased. One can close the account, take over the account or pay the debts. Whatever the case, it is very essential to have your accounts and credits scores sorted out at any stage, so as to avoid confusions and frauds once you are gone.
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