When a borrower with student loans dies, their student loans will typically be discharged, or forgiven, and will no longer be the responsibility of the borrower’s estate or their surviving family members. This means that the borrower’s heirs will not be required to pay off the student loans, and the lender will not be able to seek payment from the borrower’s estate.
However, there are a few things to keep in mind when it comes to student loan debt and death:
It is important to inform the lender or loan servicer of the borrower’s death as soon as possible. This will help ensure that the loans are discharged promptly and that the borrower’s credit report is updated to reflect the discharge.
Some types of student loans, such as Parent PLUS loans, may be the responsibility of a cosigner or other person who is not the borrower. In these cases, the cosigner or other person may be responsible for paying off the loans if the borrower dies.
If the borrower had a cosigner on their student loans and the cosigner is still alive, the cosigner may be required to pay off the loans if the borrower dies.
If the borrower had a co-borrower on their student loans and the co-borrower is still alive, the co-borrower may be required to pay off the loans if the borrower dies.
It is important to carefully review the terms of your student loans to understand what will happen to the debt in the event of your death. You may also want to consult with a financial planner or attorney to help you understand your options and protect your assets.