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Writing a Will When You Have Significant Debt in the UK

· 38 min

Note: The following scenario is fictional and used for illustration.

Emma, 38, kept her life insurance documents in a folder marked "sort later." As a single mum with £18,000 in credit card debt and a £220,000 mortgage on her £280,000 flat, she felt she couldn't think about death until she "got her finances straight."

When a cancer diagnosis forced the conversation, her sister discovered Emma had no will. Emma had assumed her debts would pass to her two children and wanted to protect them by avoiding estate planning entirely.

Over 29 million British adults anticipate receiving inheritances in the next 20 years, but 9% will face debt or further debt if expected money doesn't materialize.

The truth Emma didn't know: her debts wouldn't pass to her children, but without a will, her estate would face costly complications that could have been avoided.

This article explains exactly how debt is handled after death in the UK, why you can and should make a will even with significant debt, and how proper planning protects your family from your liabilities.

Table of Contents

Can You Make a Will If You Have Debt in the UK?

Yes, you can absolutely make a will if you have debt in the UK.

Having debt—whether credit cards, loans, mortgages, or other liabilities—does not prevent you from creating a legally valid will. In fact, having debt makes a will even more crucial for protecting your family.

Under the Wills Act 1837 and Administration of Estates Act 1925, your ability to make a will depends on being 18 or older and having testamentary capacity—understanding what you're doing when making your will. Your debt level is completely irrelevant to will validity.

Debt actually makes a will more important, not less. Without a will, intestacy rules decide who handles your estate, potentially leaving someone inexperienced to navigate complex debt situations. With a will, you appoint a trusted executor who understands your finances and can handle creditors professionally.

Debt complicates probate. Multiple creditors, payment priorities, and potential insolvency proceedings all require careful management. Having a will streamlines this process by providing clear authority and guidance.

Many people believe they should wait until their debts are cleared before making a will. This is a dangerous misconception. More than eight million people across the UK need to get debt advice, and millions more live on the financial edge. In 2024/25, households in a negative budget were in an average deficit of £343 every month.

Most people carry some debt throughout life. Mortgages take 25 years or more to pay off. Waiting could mean dying intestate, which creates far more problems for family dealing with debt.

Michael, 45, had £12,000 in credit card debt and a £180,000 mortgage. He delayed making a will because he felt "irresponsible" planning his estate while in debt.

When he died suddenly, his wife spent eight months navigating intestacy rules and dealing with creditors, all while grieving. A will would have appointed her as executor and specified how to handle the house and remaining assets after debts were paid.

You don't need to be debt-free to make a will. You need to protect the people you love.

When you die, your debts don't disappear—but they also don't pass to your family.

Instead, debts become part of your estate and must be paid from your assets before anyone inherits anything. This is established in Section 34 of the Administration of Estates Act 1925, which makes the deceased's estate assets available for payment of debts.

Your estate includes all property you owned at death: your house, money in bank accounts, savings, investments, car, jewelry, furniture, and personal possessions. The net estate—what remains after debts are paid—goes to beneficiaries.

Your executor has specific legal duties regarding debt. They must identify all debts by searching through paperwork, checking credit reports, and notifying creditors via the probate process. They must value the estate to determine total assets versus total debts.

They must pay debts in the correct legal order, which we'll cover in detail later. Most importantly, they must protect themselves by not distributing assets to beneficiaries until debts are settled. According to GOV.UK guidance, if you distribute the estate and it then cannot afford to pay a debt, you may have to pay it yourself.

The timeline for debt payment typically follows this pattern: In weeks one to four, the executor applies for a Grant of Probate and identifies debts. During months two to six, they contact creditors, value the estate, and determine solvency. In months six to twelve, debts are paid in legal order and Inheritance Tax is assessed and paid. After debts are cleared, remaining assets are distributed to beneficiaries.

The process can take 12 to 18 months with complex debts. Probate disputes rose significantly over the past decade, often involving debt complications.

The cost to apply for probate is £300 if the estate is valued at over £5,000. There is no fee if the estate is valued at £5,000 or less.

When David, 52, died with £25,000 in debts and a £200,000 estate (house plus savings), his executor brother followed the legal process. He applied for probate, contacted all creditors with proof of death, paid debts in correct order from estate funds, and distributed the remaining £175,000 to David's children as specified in his will.

The will made this process straightforward. Without it, intestacy rules would have complicated every step.

With a Will Without a Will (Intestacy)
You choose executor who understands your finances Court appoints administrator (may not know your debts)
Executor has clear authority to act Administrator must navigate intestacy rules while dealing with creditors
You can leave instructions or letter of wishes about debts No guidance for administrator on debt priorities or locations
Faster probate process (executor has clear mandate) Slower process (administrator must follow rigid intestacy framework)
Remaining assets go to chosen beneficiaries Assets distributed by intestacy rules (may not match your wishes)

Will Your Family Inherit Your Debts? Dispelling the Myth

No, your family does not automatically inherit your debts when you die in the UK.

This is one of the most widespread misconceptions about debt and inheritance. Your debts are paid from your estate, not passed on to your loved ones.

Under UK law, debts are attached to the estate, not to individuals. Family members, friends, and beneficiaries have no legal obligation to pay your debts unless they meet specific exceptions. National Debtline confirms that family members are not responsible for a deceased person's debts in most circumstances.

There are three specific situations where family members are liable for debts.

First, joint loans or credit agreements. If you have a joint loan, credit card, or bank account, the surviving person remains fully liable for the entire debt. A joint mortgage with your spouse means the surviving spouse is responsible for full mortgage payments. A joint credit card means the surviving account holder owes the full balance.

Being an "authorized user" on a credit card is not the same as being a joint account holder. Authorized users are not liable for the debt.

Second, loan guarantees. If someone guaranteed or co-signed your loan, they become liable if your estate cannot pay. This is common with student loans (parental guarantees), business loans, and car finance.

Third, secured debts on shared property. If you owned property jointly and have a secured loan, creditors can force sale even if only one person owed the debt. For example, with joint tenants on a house, even though ownership passes automatically to the survivor, creditors can apply for an Insolvency Administration Order within five years to claim the deceased's share.

In the vast majority of cases, family members are not liable. Personal credit cards in the deceased's name only are paid from the estate or written off if the estate is insolvent. Personal loans without a guarantor are the creditor's loss if the estate is insolvent. Utility bills and council tax for the deceased's sole residence are paid from the estate. Medical debts, which are rare in the UK, are the estate's responsibility.

Student loans are an exception that brings good news. When someone passes away, their student loan dies with them. A loved one must contact the Student Loans Company and provide both the deceased's reference number and a copy of their death certificate. At this point, any remaining balance will be written off.

Sarah, 42, died with £15,000 in personal credit card debt in her name only. Her adult children worried they'd have to pay it.

Because they had no joint agreements or guarantees, and Sarah's estate was insolvent (only £8,000 in assets), the credit card companies wrote off the remaining £7,000. Sarah's children paid nothing.

James and his wife had a joint mortgage of £180,000 and a joint overdraft of £3,000. When James died, his wife became solely responsible for both debts because they were joint agreements.

However, James's £150,000 life insurance, written in trust, paid out to his wife tax-free. This allowed her to pay down the mortgage significantly.

Tom's father guaranteed his £10,000 business loan. When Tom died and his estate couldn't cover the loan, the lender pursued Tom's father for the remaining £6,000 because he was the guarantor. Tom's siblings had no liability because they hadn't guaranteed the loan.

If you're worried about your family being burdened by your debts, the key protections are: avoid joint credit agreements unless necessary, consider life insurance to cover major debts like mortgages, make a will so a capable executor handles your estate properly, and inform your executor where to find debt records so nothing is missed.

What Happens to Different Types of Debt When You Die

Not all debts are treated equally after death.

Understanding how different types of debt are handled helps you plan your estate and reassure your family about what to expect.

Secured debts have the highest priority. Mortgages are secured against property and must be paid or the property sold to clear the debt. If you have a joint mortgage, the surviving borrower assumes full responsibility. If you have a sole mortgage, the estate must pay from assets or sell the property.

Life insurance often covers mortgages, but if the policy is not written in trust, it becomes part of the estate.

Helen's £200,000 mortgage on her £280,000 house was paid from her estate. Her executor sold the house, paid the mortgage, and distributed the remaining £80,000 (minus probate costs) to her children as specified in her will.

Secured loans—like car finance or secured personal loans—give the lender a claim on a specific asset. The lender can repossess the asset if the debt isn't paid. If the asset value exceeds the debt, the surplus goes to the estate.

Priority debts come next. Funeral costs are paid first from the estate before other debts. Reasonable funeral expenses are protected by law under Insolvency Act 1986 provisions.

Council tax and utility bills for the deceased's sole residence are paid from the estate. For shared residences, surviving residents may still be liable for ongoing bills. Rent arrears become the estate's debt if it's council or social housing. For joint tenancies, the surviving tenant is liable.

Preferential debts include occupational pension scheme contributions (limited arrears) and employee remuneration for a limited period. These rank after secured debts and funeral costs but before unsecured debts.

Unsecured debts have the lowest priority. Credit cards are paid from the estate in order of priority. If the estate is insolvent, credit card companies often receive nothing. Personal credit cards in the deceased's name carry no family liability. Joint credit cards leave the surviving account holder fully liable.

Personal loans are paid from the estate if funds are available. Without a guarantor, it's the lender's loss if the estate is insolvent. With a guarantor, the guarantor becomes liable for the unpaid balance.

Overdrafts on sole accounts are frozen and paid from the estate. On joint accounts, the surviving account holder is liable.

Store cards and buy-now-pay-later arrangements are treated the same as credit cards—paid from the estate or written off. In the 12 months to May 2024, 10.9 million UK adults (20%) used buy now, pay later credit. This is an increasingly common debt type.

Some debts are written off entirely. Student loans are automatically cancelled upon death. The process requires contacting the Student Loans Company with a reference number and death certificate. There is no estate or family liability.

Payment Protection Insurance linked debts may be covered if the PPI included death benefit coverage. Check loan agreements to see if a claim can pay off the balance.

The legal hierarchy for debt payment follows this order: secured debts (mortgages, secured loans), funeral expenses (reasonable costs), testamentary and administration expenses (probate costs, executor fees), preferential debts (pension contributions, employee wages within limits), unsecured debts (credit cards, personal loans, overdrafts), interest on unsecured debts, and finally deferred debts if any.

If the estate doesn't have enough to pay all debts, each category is paid in full before moving to the next category. Within the same category, creditors receive proportional payments, known as pari passu distribution.

Total household debt in Great Britain was £1.28 trillion in April 2016 to March 2018, of which £119 billion (9%) was financial debt and £1.16 trillion (91%) was property debt (mortgages).

Debt Type What Happens Family Liability? Estate Priority
Mortgage Must be paid or property sold Only if joint mortgage Secured (High)
Credit card (sole) Paid from estate or written off No Unsecured (Low)
Credit card (joint) Surviving account holder liable Yes—joint account holder N/A—not estate debt
Personal loan (no guarantor) Paid from estate or lender's loss No Unsecured (Low)
Personal loan (with guarantor) Guarantor liable if estate can't pay Yes—guarantor only Unsecured (Low)
Student loan Written off automatically No N/A—cancelled
Council tax Paid from estate Only if still living in property Priority debt
Funeral costs Paid first from estate No Highest priority

Understanding Insolvent Estates: When Debts Exceed Assets

An estate is called "insolvent" if the total needed to pay the funeral costs, administration costs and debts is greater than the total value of the assets.

This is the definition used by GOV.UK Technical Guidance for deceased insolvents.

While exact statistics on insolvent estates aren't published annually, debt advisors report increasing cases. More than half of the people Citizens Advice helps with debt are in a negative budget. Those in a negative budget have average levels of debt of £9,963 per household.

Many estates are borderline insolvent, where debts nearly equal assets.

When an estate is insolvent, the executor first determines insolvency by valuing all assets and listing all debts. If debts exceed assets, the estate is insolvent. The executor should not pay any creditors until the insolvency process is followed, to avoid preferential treatment claims.

There are two legal process options. The first is informal administration, if creditors agree. The executor contacts all creditors, explains insolvency, and creditors agree to proportional payment of available funds. No court involvement is needed if all creditors consent.

The second option is an Insolvency Administration Order. A creditor or executor can apply to court for a formal insolvency order. The estate is then handled under the Insolvency Act 1986. An official receiver or insolvency practitioner is appointed. This structured process protects the executor from personal liability. Creditors can apply within five years of death.

Assets are distributed in legal order as described in the previous section. If there are insufficient funds in a category, creditors receive proportional payment following the pari passu principle.

For example, if an estate has £10,000 but unsecured debts total £30,000, each unsecured creditor receives 33.3p per £1 owed.

Beneficiaries receive nothing if the estate is insolvent. Gifts specified in the will cannot be honored until all debts are paid. If debts exceed assets, creditors take losses and beneficiaries receive nothing.

This is not "inheriting debt." Beneficiaries simply don't inherit assets either.

Executors are not personally liable for the deceased's debts as long as they follow proper legal procedures. The risk comes from distributing the estate before paying debts. If you distribute the estate and it then cannot afford to pay a debt, you may have to pay it yourself.

Best practice: get professional advice if the estate appears insolvent before distributing anything.

Marcus died with £45,000 in debts (£25,000 credit cards, £15,000 personal loan, £5,000 overdraft) but only £18,000 in assets (car plus savings).

His executor paid £3,000 funeral costs from the £18,000, then paid £1,000 in probate and administration costs. This left £14,000 remaining for £45,000 in unsecured debts.

Each creditor received approximately 31p per £1 owed. Marcus's children, named in his will, received nothing. But they also paid nothing—creditors absorbed the losses.

Lisa's estate had £95,000 in assets (£80,000 house equity, £15,000 savings) and £88,000 in debts (£85,000 mortgage, £3,000 credit cards). After paying funeral costs (£4,000) and probate fees (£300), her estate was left with approximately £2,700 for her daughter.

Without a will, intestacy rules and legal costs would have consumed this small surplus entirely.

If you think your estate may be insolvent, make a will anyway. Appoint a capable executor who can handle insolvency proceedings. Consider life insurance—even a small policy can move an estate from insolvent to solvent. Document everything. Leave clear records of debts and assets so your executor isn't searching.

Seek debt advice now from organizations like Citizens Advice, StepChange, and National Debtline, which offer free support. Don't avoid planning. Dying without a will makes the insolvency process harder for your family.

How to Protect Your Family When You Have Debt

Having debt doesn't mean you can't protect your family.

While you can't eliminate creditor claims on your estate, you can take strategic steps to maximize what your loved ones receive and minimize complications.

Making a will is the foundation. It appoints an executor who understands your finances, avoids intestacy complications that delay debt resolution, lets you specify who gets any remaining assets after debts are paid, and provides clarity for your family during a difficult time.

Include a trusted executor, ideally someone financially savvy. Make clear beneficiary designations for any surplus. Consider a letter of wishes explaining your debt situation—it's not legally binding but helps your executor.

Life insurance in trust is a powerful protection tool. Life insurance written "in trust" pays directly to named beneficiaries. It does not form part of your estate. Creditors cannot claim against it. It's also tax-efficient, usually with no inheritance tax.

Rebecca had £30,000 in debts and a £100,000 life insurance policy written in trust for her children. When she died, the life insurance paid directly to her children tax-free.

Creditors could only claim against her other estate assets (£20,000), which didn't cover all debts. But her children still received the full £100,000.

To set up a life insurance trust, contact your life insurance provider. Complete trust documentation naming beneficiaries. Existing policies can often be put in trust free of charge. For new policies, select the trust option at setup.

Most life insurance providers offer trust setup free. Term life insurance typically costs £10 to £30 per month.

Joint ownership structures should be used carefully. With joint tenancy, property passes automatically to the surviving owner, initially bypassing the estate and creditors. However, creditors can apply for an Insolvency Administration Order within five years. With tenants in common, your share forms part of the estate and is available to creditors.

As GOV.UK warns, creditors can apply for an Insolvency Administration Order within five years of death, which can have the effect of dividing the property in two and can force a sale.

Joint tenancy offers short-term protection but isn't foolproof. A better strategy is to pay down secured debts against shared property.

Pension death benefits offer another protection. Most pensions don't form part of your estate. Pension scheme trustees decide who receives death benefits based on your expression of wishes form.

Contact your pension provider and ensure your expression of wishes form is up to date. Pension death benefits are usually protected from creditors.

Gifting during lifetime requires caution. Gifts made more than seven years before death are outside your estate for inheritance tax purposes. This can reduce estate value, potentially making it solvent.

Be very careful with this strategy. If you make gifts to avoid paying creditors, this can be challenged as "transactions at undervalue" under insolvency law. Only gift what you can genuinely afford to give away.

Small gifts within exemptions (£3,000 annual exemption) are fine. Large gifts to "hide assets" from creditors are illegal and can be reversed.

Reduce debt where possible. Free debt advice is available from Citizens Advice, StepChange, National Debtline, and MoneyHelper (government-backed guidance).

Debt solutions that improve your estate position include debt management plans (reduce monthly payments, clear debts faster), debt consolidation (lower interest, single payment), and Individual Voluntary Arrangements (IVAs—formal agreements to pay a percentage of debts).

Avoid bankruptcy if possible, as it doesn't eliminate debts from your estate if you die during the bankruptcy period.

Document everything for your executor. Create a financial summary document listing all debts (creditor names, account numbers, approximate balances), all assets (property, savings, investments, pensions), location of important documents (mortgage deeds, loan agreements, bank statements), insurance policies (especially life insurance), and contacts (financial advisor, accountant if any).

When executors can't find debt records, they may miss creditor deadlines or fail to claim against Payment Protection Insurance. Complete records speed up probate by months.

Consider funeral plans. Pre-paid funeral plans cost £3,000 to £5,000 typically. You pay for your funeral in advance, removing this cost from your estate. This ensures funeral costs don't consume limited assets. The money is protected in trust and guaranteed to cover the funeral.

An alternative is to set aside a small savings account specifically for funeral costs and inform your executor.

Action checklist:

  • Make a will appointing a financially capable executor
  • Review life insurance and consider putting it in trust
  • Update pension expression of wishes forms
  • Create financial summary document for executor
  • Seek free debt advice if struggling with payments
  • Consider term life insurance to cover major debts (mortgage)
  • Review joint ownership arrangements (property, accounts)
  • Avoid large gifts that could be seen as hiding assets from creditors
  • Keep all debt and asset records in one accessible location
  • Inform executor where to find financial documents

What Your Executor Needs to Know About Your Debts

Your executor has a crucial role in handling your debts after you die.

Choosing the right person and preparing them properly can make the difference between a smooth estate settlement and months of complications.

Executors have core responsibilities regarding debt. They must identify all debts by searching papers, checking credit reports, and advertising for creditors. They must value the estate accurately and determine if it's solvent or insolvent.

They must pay debts in the correct legal order. They must protect estate assets from creditors where appropriate. They must keep detailed records of all transactions and communicate with creditors professionally.

Executors are protected from personal liability if they follow proper procedures. The risk comes from distributing assets before debts are paid.

Executors identify debts through several steps. First, they search the deceased's paperwork for bank statements showing regular payments, loan agreements, credit card statements, mortgage documents, and email confirmations for credit accounts.

Second, they check the credit file. Executors can request the deceased's credit report from Experian, Equifax, and TransUnion. This shows all registered credit accounts and may reveal debts the deceased didn't mention.

Third, for formal estates, they advertise for creditors. The executor places a notice in the London Gazette and local newspaper, giving creditors two or more months to come forward. This protects the executor from later claims by unknown creditors.

Fourth, they contact known creditors. They send a copy of the death certificate, request final balance statements, and freeze accounts to prevent further interest and charges.

When choosing an executor for an estate with debt, look for someone who is financially organized and literate, able to handle paperwork and deadlines, comfortable negotiating with creditors, trustworthy with estate assets, and patient (probate with debts can take 12 to 18 months).

You can appoint a professional executor—a solicitor or bank—if your estate is complex. They charge fees, typically 3% to 5% of estate value. For estates with significant debt, a professional may be worth the cost.

You can appoint two executors who must act jointly. This provides oversight and shares the burden, but both must agree on all decisions.

Have a conversation with your executor now. Tell them: "I have made a will and named you as executor," "I have debts totaling approximately £X," "The debts are: [brief overview]," "My assets total approximately £Y," "I've left a financial summary document at [location]," and "If my debts exceed assets, the estate may be insolvent—here's what that means."

Provide a copy of your will or tell them where the original is stored. Give them your financial summary document and access to your password manager or list of financial accounts. Share contact details for any financial advisors or accountants.

Common executor mistakes with debt include paying beneficiaries before debts (consequence: executor may be personally liable for unpaid debts; solution: never distribute the estate until all debts are identified and paid), paying wrong creditors first (consequence: legal challenges from preferential creditors, potential personal liability; solution: follow statutory order of payment strictly), missing creditor deadlines (consequence: estate may face additional interest, penalties, legal action; solution: keep detailed timeline, set reminders, respond to creditors promptly), failing to advertise for creditors (consequence: creditor appears after estate distributed, executor personally liable; solution: always advertise in Gazette plus local paper for estates over £5,000), and not getting professional help with insolvency (consequence: executor overwhelmed, potential legal mistakes; solution: consult solicitor or insolvency practitioner if estate appears insolvent).

Resources for executors include GOV.UK probate guidance (step-by-step process), Citizens Advice (free executor guidance), the Law Society (find a probate solicitor), MoneyHelper (dealing with deceased's debts), and Which? (probate and estate administration guides).

Executors are entitled to reimbursement for reasonable expenses like postage, travel, and phone calls. Professional executors charge a percentage of the estate (3% to 5% typically). Family member executors usually don't charge but can claim reasonable costs.

If the estate is insolvent, executor expenses are paid as administration costs, before unsecured creditors.

When Jane was appointed executor for her brother's estate, she discovered £40,000 in debts she didn't know about.

She ordered his credit reports, advertised in the London Gazette, contacted all creditors with the death certificate, valued the estate at £55,000, determined the estate was solvent but just barely, paid debts in legal order, and distributed the remaining £12,000 (after costs) to beneficiaries per the will.

The process took 14 months. Jane protected herself from liability by following proper procedures and seeking solicitor advice when uncertain.

Common Mistakes People Make With Wills and Debt

Even with the best intentions, people with debt often make estate planning mistakes that complicate matters for their families.

Here are the most common errors and how to avoid them.

Waiting to make a will until debt is cleared is a major mistake. Most people carry debt for decades (the average mortgage term is 25 years). Unexpected death means dying intestate. Intestacy plus debt equals maximum complications for family.

Households in a negative budget have average levels of debt of £9,963 per household, and debt levels have grown by 25% compared to pre-pandemic.

Make a will now, regardless of debt level. You can update it as your financial situation changes.

Not telling your executor about debts is another common error. The executor wastes months searching for creditors. Missed payment deadlines lead to additional fees. Family members are shocked by debts they didn't know about. There's potential for the executor to distribute assets before finding all debts, creating personal liability.

Create a financial summary document. Have an honest conversation with your executor. Leave records in an accessible location.

Naming beneficiaries on joint accounts to "avoid probate" causes problems. Joint account holders have immediate access to funds and may spend before debts are paid. Creditors can challenge transfers from joint accounts if done to avoid debt. This creates conflict between the executor's duty and joint holder's access. It may not achieve the intended result, as creditors can still claim within five years.

Keep accounts in your sole name. Specify beneficiaries in your will. Use legitimate tools like life insurance in trust.

Assuming life insurance will automatically pay debts is a mistake. If not in trust, life insurance becomes part of the estate and must be used to pay debts before beneficiaries receive anything. If in trust, it pays directly to beneficiaries and isn't available for debt payment.

For mortgage protection, keep insurance in the estate or have enough insurance for both debt payment and family provision. For family protection, put insurance in trust. Have a clear plan for which insurance pays which purpose.

Making large gifts shortly before death to "save assets" is dangerous. Gifts within seven years may still be part of the estate for inheritance tax. Gifts to avoid creditors can be challenged as "transactions at undervalue." Creditors can reverse fraudulent transfers. This creates family conflict and legal disputes.

Make gifts genuinely, not to hide assets. Stay within exemptions. Get advice if considering large gifts while insolvent.

Leaving specific gifts without considering debts creates false expectations. Tom's will left his £15,000 car to his daughter. When he died with £30,000 in debts and only £20,000 in other assets, the executor had to sell the car to pay creditors.

The daughter received nothing and felt betrayed. But Tom's debts legally had priority.

Use "residual estate" language: "After all my debts are paid, I leave my remaining estate to..." Avoid specific gifts if the estate may be insolvent. Or use life insurance in trust to fund specific gifts outside the estate.

Not reviewing your will after your debt situation changes is problematic. A will made when solvent may not work when insolvent, and vice versa. Beneficiary designations no longer make sense. The executor may no longer be appropriate for the financial situation.

Review your will every three to five years or after major financial changes (inheritance received, debt paid off, new mortgage, redundancy).

Choosing an executor who can't handle creditors is a mistake. Creditors can be aggressive with phone calls, letters, and legal threats. Executors need to negotiate, stand firm on legal rights, and manage deadlines.

Sarah named her elderly mother as executor. When Sarah died with £25,000 in debts, her mother was overwhelmed by creditor calls and nearly paid from her own savings, which was unnecessary. She eventually hired a solicitor for £5,000 to handle it.

Choose an executor with financial literacy, assertiveness, patience, and willingness to get professional help.

Not considering a professional executor for complex debt is the final common mistake. Some estates need professional help: those with multiple secured debts, business debts mixed with personal debts, potential insolvency proceedings, or creditor disputes that are likely.

For estates with more than £50,000 in debts or complex creditor situations, consider appointing a solicitor as co-executor or professional executor. Yes, they charge 3% to 5%, but they protect the estate and family from costly mistakes.

Red flags that suggest you need professional executor help include debts exceeding £50,000, business debts or guarantees, creditor disputes already in progress, secured debts on multiple properties, estates that may be insolvent, and complex asset structures (trusts, overseas property, business interests).

Taking Action: Creating Your Will Despite Debt

You now understand that having debt doesn't prevent you from making a will—in fact, it makes a will even more important.

Here's how to take action and create your will, regardless of your debt situation.

Every will needs essential elements: executor appointment (choose someone financially capable), guardian appointment (if you have minor children), residual beneficiaries ("after debts paid, I leave remaining estate to..."), and witnesses (two independent adults who are not beneficiaries).

For debt-specific considerations, grant broad powers to your executor to deal with creditors. Consider naming a backup executor in case your first choice can't serve.

For residual versus specific gifts, if your estate may be insolvent, use only residual gifts ("share of remaining estate after debts"). If your estate is clearly solvent, you can use specific gifts ("my car to my son"). For middle ground situations, use residual gifts primarily and specific gifts only for items of sentimental, not financial, value.

A letter of wishes is optional but helpful. It's not legally binding but provides guidance to your executor. You can explain: "I have approximately £X in debts. Records are located [here]. If the estate is insolvent, please follow legal priority order and don't feel obligated to strain yourself personally."

Don't include specific debt amounts in your will. Debts change constantly, and your executor will identify current debts. Don't include instructions to pay specific creditors first—you must follow legal order. Don't include requests that beneficiaries pay your debts—this isn't legally enforceable. Don't include "I forgive the debt owed to me by [person]" if your estate may be insolvent—this is an asset creditors can claim.

Discussing your will and debts with family prevents shock when they learn about debts after your death. It allows you to explain your planning and protect family from worry. It helps your executor prepare for their role.

For talking to adult children, try this approach: "I've made a will and want you to know what to expect. I've named [executor] to handle my estate. I have debts—[brief overview: mortgage, credit cards, etc.]—totaling about £X. If something happens to me, these debts will be paid from my estate before anyone inherits anything. This is normal and legal. You won't be responsible for my debts, but you also might not inherit much if my debts are close to my assets. I wanted you to know this so you're not surprised or worried."

For talking to your executor: "I've named you as executor in my will. I want to be honest about my financial situation. I have about £X in debts and £Y in assets. If I die, you'll need to handle probate and deal with creditors. I've created a document listing all my debts and assets [location]. If the estate turns out to be insolvent, you won't be liable—just follow the legal process. Would you be comfortable with this role? If not, I can name someone else or look at a professional executor."

For creating your will, you have options. An online will service like WUHLD is best for straightforward estates, even with significant debt. The cost is £99.99. The process involves answering guided questions, previewing your will free, and paying only when ready. You receive a will, Witness Guide, Testator Guide, and Asset Inventory. It takes about 15 minutes.

This is suitable for most debt situations: mortgages, credit cards, and personal loans.

A solicitor is best for complex debt situations like business debts, creditor disputes, or insolvency proceedings that are likely. According to a Which? survey from May 2025, the cost averages £328, but can exceed £650 for complex estates. The process involves an initial consultation, draft will, review, and signing. It takes two to six weeks.

This is necessary for business owners with guarantees, existing creditor disputes, estates valued over £500,000, or international debts.

If your debt is standard consumer debt (mortgage, credit cards, personal loans, car finance) and your assets are straightforward (house, savings, car, personal possessions), an online service like WUHLD is appropriate and saves £200 to £500. If you have business debts, guarantees, or creditor legal actions already in progress, consult a solicitor.

After you've made your will, take immediate actions: sign your will with two witnesses present, store the original in a safe location (fireproof safe, solicitor, bank), tell your executor where the will is stored, and create a financial summary document for your executor.

For ongoing actions, update your will if your debt situation changes significantly (for example, mortgage paid off or inheritance received). Review your will every three to five years. Keep financial records organized. Consider life insurance in trust to supplement your estate. Seek debt advice if struggling from Citizens Advice, StepChange, or National Debtline.

Making a will when you have debt is not only possible—it's one of the most responsible things you can do for your family. It ensures a capable person handles your estate, creditors are paid properly, and any remaining assets go to the people you choose.

Don't let debt shame or misconceptions prevent you from protecting your family. Take action today.

Frequently Asked Questions

Q: Can I make a will if I have debt in the UK?

A: Yes, you can and should make a will even if you have significant debt. Having debt doesn't prevent you from making a valid will under UK law. In fact, a will becomes even more important when you have debts because it allows you to appoint a trusted executor who can handle your estate properly, ensure debts are paid in the correct legal order, and protect any remaining assets for your chosen beneficiaries.

Q: Do my family inherit my debts when I die?

A: No, family members do not automatically inherit your debts in the UK. Debts are paid from your estate (your property, money, and possessions) before anything passes to beneficiaries. Family members are only liable for debts if they had a joint loan or credit agreement with you, provided a loan guarantee, or are a surviving spouse on a joint mortgage.

Q: What happens if my debts are more than my assets?

A: If your estate's debts exceed its assets, your estate is considered "insolvent." In this case, debts are paid in a specific legal order: secured debts and funeral costs first, followed by preferential debts (like certain pension contributions), then unsecured debts like credit cards. Some creditors may receive only partial payment or nothing at all, but beneficiaries will receive nothing until all debts are settled.

Q: Will my executor be personally liable for my debts?

A: No, executors are not personally liable for the deceased's debts as long as they follow proper legal procedures. However, if an executor distributes estate assets to beneficiaries before paying off debts, and the estate then cannot afford to pay a debt, the executor may have to pay it themselves. This is why executors must identify all debts and pay them in the correct order before distributing inheritances.

Q: Should I include my debts in my will?

A: You don't need to list specific debts in your will, as your executor has a legal duty to identify and pay all debts from your estate regardless. However, you should inform your executor where to find records of your debts (bank statements, loan agreements, credit cards). Some people choose to leave a separate "letter of wishes" detailing their financial situation to help their executor.

Q: Can creditors claim against my life insurance policy?

A: It depends on how the policy is written. If your life insurance policy is written "in trust" for named beneficiaries, it pays out directly to them and doesn't form part of your estate, so creditors cannot claim against it. If the policy is not in trust, the payout becomes part of your estate and must be used to pay debts before beneficiaries receive anything.

Q: What debts are written off when you die in the UK?

A: Student loans are automatically written off when you die in the UK—your family simply needs to notify the Student Loans Company with your reference number and death certificate. Some insurance-linked debts (like Payment Protection Insurance) may also be cancelled. However, most other debts—mortgages, credit cards, personal loans, council tax arrears—remain and must be paid from your estate.

Conclusion

Having significant debt doesn't prevent you from making a will—in fact, it makes a will more crucial than ever for protecting your family and ensuring your estate is handled properly.

Here's what you need to remember:

  • You can and should make a will even with debt. UK law doesn't require you to be debt-free to create a valid will. Your debt level is completely separate from your right to plan your estate and protect your family.

  • Your family won't inherit your debts. Unless they were joint borrowers, guarantors, or share secured property with you, your family has no legal responsibility for your personal debts. Debts are paid from your estate, not passed to loved ones.

  • A will protects your family from debt complications. Without a will, intestacy rules and creditor claims create maximum stress for your family. A will appoints a capable executor to handle debts properly and protects any remaining assets for your chosen beneficiaries.

  • Take action now, not after debt is cleared. Most people carry debt for decades. Waiting to make a will until you're debt-free could mean dying intestate and leaving your family with the worst possible situation—navigating both intestacy rules and creditor claims without your guidance.

  • Professional help is available. If your debt situation is complex or your estate may be insolvent, consult a solicitor or debt advisor. For standard consumer debt (mortgages, credit cards, personal loans), online will services like WUHLD provide affordable, legally valid wills.

Don't let debt shame or misconceptions stop you from protecting the people you love. Every day you wait is another day your family is at risk.

Making a will is an act of love and responsibility, regardless of your financial situation. The people who care about you want you to be protected—and they want to be protected too.

Need Help with Your Will?

Understanding how debts are handled after death helps you create a will that protects your family and ensures your estate is managed properly, even if your debts are significant.

Create your will with confidence using WUHLD's guided platform. For just £99.99, you'll get your complete will (legally binding when properly executed and witnessed) plus three expert guides. Preview your will free before paying anything—no credit card required.

Legal Disclaimer:

This article provides general information only and does not constitute legal or financial advice. WUHLD is not a law firm and does not provide legal advice. Laws and guidance change and their application depends on your circumstances. For advice about your situation, consult a qualified solicitor or regulated professional. Unless stated otherwise, information relates to England and Wales.

Sources:

This article references the following authoritative sources: