How to stop debt or pension payments after someone dies

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    A. I am so sorry for your loss, Jarnail. The difficult reality of losing a loved one is that there are financial, legal, and other administrative obligations to deal with while grieving.

    Depending on the source of the student loan, there may be no repayment obligation and payments made after your son’s death may be owed to his estate.

    If your son’s loan was a federal student loan, the Canada Student Financial Assistance Act states, “A borrower’s obligations regarding a loan … end when the borrower dies.” The National Student Loans Service Center ( NSLSC) can be contacted in various ways.

    If the loan was a provincial or territorial student loan, you can Contact the responsible student office. For example, the Ontario Province Masters Student Financial Aid Agreement states, “The obligations … related to your outstanding credit balance end when you die.”

    If the loan is from a bank, Jarnail, then other debts of the deceased will usually have to be paid out of the assets remaining in their estate. These assets can include cash, investments, real estate, personal effects, or insurance. Note that not all assets become part of an estate. Assets that are jointly held or that have designated beneficiaries may not form part of a person’s estate.

    It is possible that an estate could be insolvent (bankrupt) and have more debts than assets. In this case, there may be provincial legislation that establishes the order of repayment of the debt. The deceased’s debts would generally not be the responsibility of their families unless it was a joint debt or there was a co-signer.

    Some debts may have life insurance associated with them that will pay off the debt after death.

    There may be other parties to be contacted after someone dies, and even payments to which an estate or beneficiary is entitled.

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