Every American has been affected by the coronavirus in some capacity – and the last thing relatives of the deceased should have to deal with are debt collectors asking them to pay the debts of a loved one.
COVID-19 has altered the lives of millions in the U.S., killing 210,000 people and forcing Americans and businesses into extremely tough and unprecedented financial situations. U.S. unemployment claims remain above 800,000; stores, factories, and business have closed, some permanently because of the inability to pay expenses. A study by the National Bureau of Economic Research found that active business owners in the U.S. plunged from 15 million to 11.7 million from February to April 2020.
The Federal Trade Commission (FTC) says that relatives are not obligated to pay the debts of the deceased from their own assets, but that the alleged debts are paid from the deceased person’s estate. There are some exceptions, however, such as if one is the deceased person’s spouse and the law requires them to pay, one co-signed the obligation, one lives in a community property state, or if one was legally responsible for resolving the state and failed to comply with state probate laws.
Know Your Rights as Consumers
If you have received harassing phone calls from debt collectors asking you to pay the alleged debts of a deceased relative, that is illegal.
Under the Fair Debt Collection Practices Act, debt collectors cannot speak to third parties, such as family members, about the debt itself unless they are associated with the debt. Debt collectors are only permitted to ask for the name, address, and telephone number of the person authorized to pay the deceased person’s debts.
Debt collectors are also prohibited from using threatening, harassing, or intimidating language. For example, they cannot threaten to sue you or garnish your wages unless they actually intend to do so. They also cannot call you at a time they know is inconvenient to you, such as the early morning or late hours or when you are at work.
Collectors may even be more ruthless during the pandemic despite the fact that so many Americans have found themselves in difficult financial situations. According to the Los Angeles Times, consumer advocates have said that debt collectors have grown increasingly aggressive as stay-at-home orders have made it easier for them to contact and occasionally harass people who owe money.
Although the federal government sent stimulus checks and enacted protections against evictions, foreclosures, and federal student loans under the CARES Act, the seizure of wages for consumer debts that are not federal or state related continued.
It is unacceptable for debt collectors to harass and lie to relatives of the deceased and say they are obligated to pay the deceased person’s debts. Debt collectors may view the pandemic as an opportunity to harass more people, especially since many Americans are financially vulnerable and are spending more time in the safety of their homes. Sending a cease and desist order to the debt collector asking them to stop sometimes isn’t enough for them to actually do so.
How Lemberg Law Can Help You
If you and/or a loved one are being harassed by a debt collector regarding a deceased relative’s debt, our experienced debt collection attorneys at Lemberg Law are equipped to get you the compensation you deserve. We understand that the unfair treatment by some debt collectors can result in serious impacts on your health and finances; which is why you may need help as soon as possible.
Navigating debt collectors who may be at fault can be a scary and frustrating experience, but it doesn’t have to be. For 13 years, Lemberg Law has made legal representation a pain-free and easily accessible process. We have successfully recovered more than $50 million in damages for more than 25,000 clients across the nation. Our track record speaks for itself.
Call Lemberg Law at 475-277-2200 or use our case evaluation form to receive a free, no obligation consultation from our experienced legal team.
FAQs about Debt Collection & COVID-19
What happens to a person’s debts after they die?
When a person passes away, their estate is obligated to pay any outstanding debts. The person’s estate consists of the assets they owned (money, real estate, vehicles, and so forth) when they died.
Who can the debt collector speak with about the deceased person’s debts?
The FTC says that debt collectors can discuss the deceased person’s debt with the executor of the estate (the person appointed to implement the deceased person’s will), the person’s spouse, the administrator of the estate, or anyone else that is authorized to pay the deceased person’s debts. If a child passes away, a debt collector may discuss the debt with the child’s parents or guardian.
Are there limits on when a debt collector can call during the bereavement period?
The FDCPA prevents debt collectors from calling at “any unusual time or place or at a time or place known or which should be known to be inconvenient to the consumer.” The FTC says, “Depending on the circumstances, contacting survivors about a debt shortly after the debtor dies may be unusual, inconvenient, or both.” In other words, if a debt collector repeatedly calls a family member in the midst of bereavement, it could be a violation of the FDCPA.
What if there isn’t enough money in a person’s estate to cover their outstanding debts?
If this occurs, debt law says the debts remain unpaid and the creditors write debt off as a loss. There are times, however, when a friend or family member may be obligated to pay all or part of the outstanding debt. For example, if you co-signed a loan with the person who passed away, you may be liable for the debt. The rules also depend on the state where you live.
How do I get a debt collector to stop calling?
You must send a cease and desist letter to the collector stating that you do not want the collector to contact you again. Make sure to keep a copy of the letter for your records. Once the collector gets your letter, they cannot contact you again except to confirm that there will be no further contact or that he or the creditor plans to take a specific action, like filing a lawsuit to collect the debt. The Consumer Financial Protection Bureau provides sample letters if you’re experiencing common problems with debt collectors.
What will the process look like if I file with Lemberg Law?
You can call us at 475-277-2200 or use our case evaluation form to receive a free, no-obligation consultation from our experienced legal team. If your case is accepted, we work toward a settlement or take the responsible party to court. If we win, you receive the compensation you deserve. If we don’t prevail in the case, we cover the tab for you.
About the Author:
Sergei Lemberg is an attorney focusing on consumer law, class actions related to automotive issues, and personal injury litigation. With nearly two decades of experience, his areas of practice include Lemon Law (vehicle defects), Debt Collection Harassment, TCPA (illegal robocalls and texts), Fair Credit Reporting Act, Overtime claims, Personal Injury cases, and Class Actions.
He has consistently been recognized as the nation's "most active consumer attorney." In 2020, Mr. Lemberg represented Noah Duguid before the United States Supreme Court in the landmark case Duguid v. Facebook. He is also the author of "Defanging Debt Collectors," a guide that empowers consumers to fight back against debt collectors and prevail, as well as "Lemon Law 101: The Laws That Lemon Dealers Don't Want You to Know."
