After we inherit a house, are we still responsible for the debts attached to it?

1 answer | Last updated: Sep 14, 2017
A fellow caregiver asked...

My Father is 82 years old and was diagnosed with Alzheimer's/Dementia several years ago. Since then, my mother passed away so we then took care of my father for a year in HIS home. My wife and I moved in with him after selling our home which was smaller and not equipped to take care of him properly. He took out a $50K line of credit against his home and had several credit card debts. The creditors are calling regarding these debts and I know they can place a lien on the home for them. We started paying down the line of credit just to keep the home from being foreclosed on. The home is paid for (except for the LOC) and is willed to us when he passes. It is in a Living Trust account and I am the trustee. I also have power of attorney for my father which has helped me do several things on his behalf. What steps can be taken by us to stop the creditors from placing liens on his home? Also, is there anything that can be done regarding the line of credit or these other bills because of his Alzheimer's Disease? Is there a government program to help lower or eliminate them? I know we are not responsible for his debts right now. However,when they become attached to the home (willed to us), we will in fact, be responsible, right?

Expert Answers

Steve Weisman hosts the nationally syndicated radio show A Touch of Grey, heard on more than 50 stations, including WABC in New York City and KRLA in Los Angeles. He is a practicing lawyer specializing in estate planning and is admitted to practice before the United States Supreme Court. He's a public speaker and commentator who has appeared on many radio and television shows throughout the country, and he's the legal editor of Talkers magazine, the preeminent trade publication of talk radio. His latest book is The Truth About Avoiding Scams.

You may wish to negotiate on behalf of your grandfather with the credit card holders as to the total amount or the interest. Assuming that the home was put into the trust before your father owed the credit card companies any money, once he passes away, it would be difficult, although not impossible in some states for them to attempt to collect against an asset, such as the house that is not a part of his probate estate.

There are no specific programs to help people with diseases who have debt problems.

Although, you never are personally responsible for your father's debts, creditors can take action against his assets before they pass to you which affects your equity in the home which is why you are better off trying to negotiate with the creditors at this time.