What Happens to Your Debt When You Die in Canada?

In Canada, debts are paid from the estate — what the person owned — before anything goes to heirs. Family members generally don't inherit debt personally.

Who might still owe

• Co-signers and guarantors remain responsible for the loans they signed. See co-signer risks and the co-signer calculator.
• Joint account holders — joint credit cards and lines of credit usually become the survivor's debt.
• A mortgage stays on the home; whoever inherits must keep paying, refinance or sell.

What the estate pays first

The executor generally pays funeral costs, taxes owed to CRA, then secured and unsecured creditors. If the estate can't cover everything, unsecured creditors may get less or nothing — rules vary by province, so executors often get legal advice.

Make it easier for your family

1. Keep a written list of every account, loan and policy.
2. Check whether loans carry creditor life insurance.
3. Make a will and name an executor.
4. Store passwords and access instructions somewhere your executor can reach. Digital estate tools such as DataWill are built for passing account access to loved ones.

General information only — speak to a lawyer or notary in your province about your situation.