Estate Planning In New Jersey: What Happens To Your Debt?

One of the most frequent questions that NJ estate planning attorneys are asked is “What happens to my debt after I die?” Or “Will my children inherit my debts?” As debt is a part of life, this are very good questions and it’s understandable to be concerned about these issues.

Common types of debt and what happens after you die 

  • Credit card debt: If you have a credit card that is solely in your name, that debt belongs to you and you alone – not those who inherit from your estate. This means that the credit card company will have to collect from the estate itself.
  • Student loan debt: Federal loans are cancelled upon death, and some private loans can be similarly discharged. If they do not qualify, however, the balance will be collected from your estate.
  • Medical debt: This debt will be paid through your estate by your executor, but if it is more than the value of your estate, your heirs will not be held responsible.

How debts are claimed from the estate 

In the State of New Jersey, the surviving spouse is not held accountable for debts that are in the name of the decedent (unless the debts are held jointly), so your credit score will not be affected and debt collectors are not allowed to call, harass or otherwise try and claim from your spouse. Instead, these debts are claimed in a particular order according to legal processes from the value of the property and assets you are leaving to your heirs.

So, what is the legal process?

First of all, reasonable funeral expenses will be paid from the estate, followed by any administrative fees (legal fees, probate fees, appraisals, etc.) if applicable. Federal and state taxes will be paid next, as well as medical/hospital expenses, and then Judgements against the decedent. Unsecured creditors will be paid last out of the estate. Creditors also only have a fixed period of time in which they can make a claim against the estate – usually around 2-6 months – after which they have to forgive the debt.

If there is nothing left in the estate before creditors are paid, the estate is then declared insolvent. This is not great news for your heirs, however, as while they will not inherit your debt, it will wipe out any money or assets you wanted to pass on to your family.

Get reliable estate planning advice – Speak to your NJ attorney 

If you would like further guidance on protecting your real estate assets by creating an irrevocable living trust, LLC or a Last Will and Testament, Frank R. Campisano can provide you with the necessary expert legal advice and professional insight.

In addition, he can also assist you with all other aspects of your estate plan, from drawing up medical directives and Power of Attorney documents to Medicaid planning. For more information on setting up or changing an estate plan, please contact him at the law firm of Sedita, Campisano & Campisano, LLC in New Jersey or visit our website at today.

Why You Need A Healthcare Advocate

Preparing for a doctor’s visit can become daunting when you’re possibly facing serious health concerns. While writing down questions ahead of your visit, revisiting your medical insurance information and completing paperwork ahead of time is important, there is one more thing for you to consider – having a healthcare advocate with you. Here is a brief guide from a leading elder law attorney in New Jersey.

What is a healthcare advocate? 

A healthcare advocate can be a friend, family member or anyone you trust – even your caregiver. Their role is to come with you to any medical appointments and ask questions and take down information about your care needs.

Why are healthcare advocates important? 

As we grow older, we’re more likely to face serious health concerns, and more likely to require assistance in understanding our options, dealing with illness and even making healthcare decisions. Your healthcare advocate is there to offer strength and support, to give your situation a clear second set of eyes and ears, and to ensure that you have all the information you need to understand your health concerns and treatment options. Essentially, they are there to help ensure that you can focus on your care and get exactly the medical treatment you prefer.

Doctors and physicians support healthcare advocacy 

For most physicians, the idea of a healthcare advocate is a positive one, as they not only provide emotional support to patients, but because they can help convey and record important information about medical care and medicines. While this is especially important for very elderly patients as well as those with dementia conditions, they are a good idea for anyone who needs someone to accurately take in a physician’s diagnosis.

What can a healthcare advocate do? 

Your healthcare advocate can:

  • Ask questions about your medical condition and treatment options, and voice your concerns.
  • Compile an accurate medications list, including how to take different medications.
  • Assist with paperwork and insurance matters.
  • Create a timeline for treatment.
  • Help with transportation to appointments.
  • Research medical treatments, procedures, doctors, etc.

Get legal assistance from your NJ elder law attorney 

If you would like legal assistance for yourself or elderly loved one, speak to Frank R. Campisano today. Experienced in elder law, compassionate and committed to his clients, you’ll receive the highest quality legal expertise and guidance that will help you secure better care. In addition, you can also prepare additional estate planning documents, such as your Last Will and Testament, Financial Power of Attorney documents, Medical Directives and Healthcare Proxy documentation. For more compassionate legal guidance and a free consultation, please contact us and visit our website today at

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