Credit card debt after death: Nowadays, the use of credit cards has increased rapidly. Through credit cards, you can avail short term loans in difficult times and can repay that loan without any interest during the grace period.
However, after the grace period is over, a huge interest has to be paid on this loan. Apart from this, many types of rewards, cashback and discounts etc. are also available on credit cards, due to which credit cards have become increasingly popular.
But the loan obtained from a credit card comes under the category of unsecured loans because nothing has to be mortgaged for it. In such a situation, if the credit card user dies without repaying the loan, then from whom will the banks recover the outstanding amount? Know what is the rule regarding this.
This is the rule in case of unsecured credit card
Usually the credit limit is determined on the basis of the applicant’s income, credit score, existing loan and repayment history etc. In such a situation, the credit card holder is also responsible for repaying the amount spent through the credit card. But if the credit card user dies before returning the amount, then the bank writes off the outstanding loan amount. In such a situation, no other family member can be forced to pay the dues.
What is the rule in case of secured credit card
But nowadays many secured credit cards are also available. Secured credit cards are mostly taken by those people who are unable to get a normal credit card. To get a secured credit card, FD has to be deposited as collateral. If the payment of credit card bill is not received from the secured credit card user for any reason, then the bank has the right to recover its loan by encashing his fixed deposit account.
Know the rules of personal loan too
Personal loan is also kept in the category of unsecured loan. In such a situation, just like a credit card, the responsibility of repaying a personal loan also lies only with the person who takes the loan. If the loan taker dies due to any reason, the bank cannot force any member of his family to repay the loan. In such a situation, the loan also ends automatically with his death.
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