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Norwood Estate Planning Lawyer > Blog > Estate Planning Attorney > Does A Child Inherit Their Parent’s Debt In Massachusetts?

Does A Child Inherit Their Parent’s Debt In Massachusetts?


Are you concerned about debt? You are far from alone. According to data from CNBC, nearly three quarters of Americans rank debt as their top source of stress. Debt is something that needs to be considered during the estate planning process. You may be wondering: Do children inherit their parents’ debt? The answer is “no”—unless they co-signed for the loan. Though, the liability will remain with a secured asset and creditors can go after the estate itself. Within this article, our Norwood estate planning attorneys explain the key things parents should understand about estate planning and debt in Massachusetts.

Children are Not Personally Liable for Parental Debt (Exception for Co-Signed Loan) 

As a starting point, it is important to understand that children in Massachusetts are not personally liable for their parents’ debt. A financial liability does not automatically pass down to the next generation. Creditors cannot go after the children’s personal assets or income to recover what is owed. However, there is an exception to this rule. If a child cosigned a loan with their parent, they may be held responsible for repaying the debt if the parent is unable to do so. In such cases, the child becomes a co-borrower and is equally responsible for the debt as the parent. 

Creditors Can Take Action Against the Parent’s Estate to Recover 

While children are not liable for their parents’ debt, creditors can still attempt to recover the debt from the parent’s estate, including assets such as property, bank accounts, and investments.

For example, imagine that a parent passes away with $10,000 in credit card debt. The creditor card company can—and likely will—make a claim against the estate in the probate process.

If the estate does not have enough assets to cover the debt, the debt may be discharged and the creditors will not receive any payment. In such cases, the debt will not be passed on to the children. 

Note: A liability remains with a secured asset. For instance, a parent may own a rental property worth $300,000. If that property has a $100,000 mortgage on it, that mortgage can remain with the property even if it is passed on to a child. 

A Comprehensive Estate Plan Will Best Protect Your Child’s Inheritance 

A proactive approach will help you best protect the inheritance of your child. An experienced Greater Boston estate planning attorney can help you put a comprehensive plan in place to ensure that your kids are able to get the most out of your inheritance. There are asset protection strategies that may help you protect your estate against debts and other potential financial liabilities.

Call Our Norwood, MA Estate Planning Attorneys Today

At Fisher Law LLC, our Norwood estate planning lawyers are standing by, ready to help you find the best solution for you and your family. If you have any questions about debt, liabilities, and estate planning, we can help. Contact our estate planning team for a confidential, initial legal consultation. From our Norwood law office, we provide estate planning services throughout the Greater Boston area, including in Westwood, Norwood, Dedham, and Walpole.



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