What happens if a person dies after taking a personal loan?

Hari asked:


Hi, I have a doubt please let me know … what happens to the loan , if a person who has taken the personal loan dies? Do the bank takes all the assets belongs to the person?

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Tags: Assets, Doubt, Personal Loan

This entry was posted on Wednesday, September 10th, 2008 at 11:05 am and is filed under Personal Finance. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.

3 Responses to “What happens if a person dies after taking a personal loan?”

1. lestermount Says:
   September 11th, 2008 at 12:06 pm

   It depends. Some people take out insurance to cancel the debt. Sometimes there could be collateral. The estate may owe the debt.
   The bank can not take all of th assets that belong to the person without legal action.

2. MadMan Says:
   September 13th, 2008 at 7:12 pm

   The estate has to pay back the loan. If there is not enough in the estate, then the lender takes a loss.

3. venus772 Says:
   September 14th, 2008 at 10:39 am

   I would assume that if they applied for an beneficiary then that person would be entitled to the funds.. Or maybe the next of kin. Or, they just give it to relatives of the deceased. If not anyone, I guess they would bank the money back into the account.

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