Banking

Q&A: Paying a deceased person’s debts

January 5, 2015 By Liz Weston

Dear Liz: When I read the letter from the woman about her mother’s debts, it brought back my situation with my brother and mom. My brother was trustee to my mother’s living will and told her she had no money. At 90, she became worried and wanted to cut back on the care she needed. My brother had the same attitude as the woman who wrote you that her mother’s property was not an asset for her to use but something to be hoarded for the heirs.

Answer: That’s not the situation the daughter described. She was asking whether she and her sister were responsible for her mother’s debts. They are not. The mother’s estate would be responsible, and her estate would include her home. If the estate’s assets aren’t sufficient to pay all the bills, however, the creditors wouldn’t be able to come after the daughters. Still, some collection agencies have been known to contact survivors, telling them they have a “moral obligation” to pay the dead person’s debts.

Q&A: Money owed on a lease after death

November 3, 2014 By Liz Weston

Dear Liz: I read your answer to the person who returned a car and wanted to be free of that debt. Our situation is somewhat different. My son’s father had a massive stroke and died two weeks after signing a lease for a Camry on which he made a $2,000 down payment. My grown son, who is left to deal with everything, took the car back to the dealership, and they assured him nothing further would be needed. The dealership then sold the car for $18,000 at an auction and said $8,000 is still owed on this car since my son’s father signed a legal contract.

Answer: The money is still owed. Whether the dealership will ever collect is another matter.

This debt is now part of the dead man’s estate, along with any other loans or credit accounts he owed at the time of his death. If the estate has sufficient available assets, the executor is required to pay those bills. If there aren’t sufficient assets, creditors may have to accept less than they’re owed or nothing at all.

If your son is the executor, he should hire an attorney experienced in settling estates to help him deal with these details. Nolo’s book “The Executor’s Guide” also will help him understand his duties and obligations.

Q&A: Fraud or forgetfulness?

October 27, 2014 By Liz Weston

Dear Liz: I think I’ve been scammed, but my credit union has decided I’m simply forgetful. I noticed a debit to my checking account that I did not recognize from a merchant I cannot identify. The merchant name appears on my statement as simply “Portland Portland OR.” My credit union can tell me only that it is a used-merchandise store or secondhand store. I questioned the charge by email and replaced my card. Then I got a letter from the credit union upholding the charge, saying that my card and PIN were present at the time of the transaction. I never did learn the merchant’s name. Can this merchant really not be identified? The $10.48 in dispute is unimportant compared with the complete opacity of the supposed purchase. No name, no address, only a day and time. Is this mystery the best the banking system can do?

Answer: Your credit union could identify the merchant by contacting the card network that processed the transaction, but has apparently decided it’s not worth the effort, said Odysseas Papadimitriou, chief executive of Evolution Finance, which operates the CardHub.com card comparison site. You can demand the credit union identify the merchant for you, but there’s reason to believe this transaction is legitimate, he said.

It’s not just because a personal identification number was used, however, since PINs certainly can be stolen. Hackers have compromised keypads at Michael’s stores and Barnes & Noble, among other retail chains, while Target said encrypted PIN data were stolen in its massive database breach.
But the use of a PIN combined with the small amount of the transaction indicates the culprit here likely is forgetfulness rather than an identity thief, Papadimitriou said. ID thieves are unlikely to make one small transaction and then wait, he said.

“They try to extract the max they can before they get shut down,” Papadimitriou said.
Still, your experience should make you think twice about using a debit card for a retail transaction. With debit card fraud, you may have to fight with your financial institution to get the money back, since the transaction comes directly out of your checking account. With credit cards, you don’t have to pay a disputed transaction until the card company investigates.

Q&A: Loose change and the ‘Big One’

October 27, 2014 By Liz Weston

Dear Liz: In your column about saving loose change, another reason to keep a couple of coffee cans full of coins is for when we have the “Big One.” ATMs and banks and stores that rely on computers will be down, but loose change and small bills will be spendable.

Answer: Every disaster preparedness kit — which every home should have — should include some cash for emergency spending. But the cash should be in the form of bills, not change, which will add unnecessary weight to your kit if you have to evacuate. A few hundred dollars in bills are easily carried — not so the 20 or 30 pounds of change that make up an equivalent amount of spendable money.

Q&A: The benefits of loose change

October 20, 2014 By Liz Weston

Dear Liz: I just had to giggle at the husband who wanted to save his coin change for an emergency. Yes, this seems so silly now, but back in the day prior to debit cards my mom started saving all her loose change in a coffee can when my husband and I got engaged. Ten months later, she had saved enough for my wedding dress! When we had our first child, we started saving all our loose change, and 10 years later, we had saved enough for a trip to Disneyland. Obviously, we are saving less and less change since we so seldom use cash anymore, but we still keep a coffee cup to collect the loose change and still manage to turn in about $100 a year to the bank.

Answer: The key is to regularly deposit the coins, rather than letting them pile up. But a few readers cautioned that it might be worth carefully sorting through older stashes of coins:

Dear Liz: You gave a good answer to the question about cans of coins. You also should advise the party that if the cans have older coins — pre-1965 — the value of those dimes, quarters and half-dollar coins is tied directly to the price of silver. At $20 per ounce, 90% silver coins are worth about fourteen times their face value. A dime would be worth about $1.40, a quarter about $3.50, and a half-dollar about $6. At the same silver price of $20, 40% silver half-dollars are worth about $2.50 each. If you use a commercial sorting service you will lose the value of these coins. If you sort them while watching TV as I do, you will recover it. Lastly, if you do roll the coins, return them to the bank immediately. If your house is burglarized, as mine was, the rolls of coins on your desk will be gone in an instant.

Answer: Ouch. Sorry for your loss. You aren’t the only one to find gold (or rather silver) in your coins:

Dear Liz: I inherited much loose change. I started going through it and found a nice can of Buffalo nickels (each worth more than a nickel) and 22 pounds of silver quarters (made before the sandwich coins) worth $7,744 less handling and processing fees. It still came to a tidy sum. Let your letter writer know that it may pay to sort through that mountain of loose change.