My mom has stage 4 breast cancer, and has olny been give a few months to live. She is willingly taking on debt, that she will not have the f...

Question

My mom has stage 4 breast cancer, and has olny been give a few months to live. She is willingly taking on debt, that she will not have the funds or time to pay off. She does not have life insurance. What is going to happen with that debt when she does pass? My sister is power of atterney and executor for her "estate".

Answer

Sorry about your mother. So long as no one else is co-signing with her, her estate will be liable for the debts. Therefore, any assets which she has at the time of her death and possibly some non-probate assets or assets which she transfers as what's called "payable-on-death" transfers will be available for the estate to pay those creditors. If there are not enough assets to cover the debts, the creditors are out of luck. In essence, most if not all of her assets will likely need to be liquidated to pay the debts. The POA powers cut off at the time of death, but the sister could be appointed to deal with the probate process via the local court. The POA or remaining relatives are generally not responsible for the debt, unless they co-sign.