4 ms·

But you can buy jewelery or other big ticket items with a credit card, and the ownership can be called into question if that card wasn't paid off before the per

• rhizome 8y ago
  That's not how credit cards work, and at any rate it's pretty difficult to get a loan for jewelry. It's the difference between "secured" and "unsecured." the ownership can be called into question if that card wasn't paid off before the person responsible died On what legal basis?
  • yebyen 8y ago
    If you are the beneficiary of the estate and your benefactor ran up their credit cards before they died, to be able to give gifts to you, the credit cards are still owed by the estate. If the estate does not have the money to pay the debt, the estate would be liquidated to cover as much as possible and the creditors get theirs before you get yours. If there is documentation to support that they did this on purpose, with the intention of defrauding the card issuers so that you can have some kind of inheritance, then what will happen? (I've never lived through this scenario but I have to imagine they'll have some recourse against you or the estate. I don't know everything about the law but I know enough to believe that the answer is not "you get to keep any ill-gotten spoils of the scheme, and simply get away with it.")
    • yebyen 8y ago
      I am not a lawyer and you can feel free to tell me I'm wrong or specifically where I'm wrong if you know more law than me, but I know there are a lot of "clever tricks" that you might think of, that you might usually be pretty much able to get away with in most circumstances ... that are technically (or blatantly) fraud and if caught, you might actually not so much be able to get away with it. For example, if your parent is past retirement age and has a sizeable nest-egg, which you've transferred into your own name with their permission, and then considered as yours, knowing that you are the executor and they are assets that are assigned to you in the will... call it a "trust" because your parent trusts you, maybe with Power of Attorney... Well, this might be legal in and of itself (I don't know specifically), but maybe it's actually not legal if you failed to document it properly. There are limits to the amount that you can gift without paying taxes. Was it a gift, or is it a trust? It might matter for tax reasons, or estate settlement reasons, or both. And one more reason that it would need to be carefully documented, even if you can legally do this is: say that your parent needs nursing care in their final days, and on paper they are flat broke. But actually this trust exists. Well, if it wasn't a crime before, to make the transfer in trust without proper documentation, it certainly becomes a crime now if they apply for medicare benefits to keep the nursing homes from "getting their hands on that money," that's medicare fraud and it's very serious. That's also pretty far from the original topic, but it's not as far as it might seem. There can be cases where something would have flown under the radar even if it was illegal, but now there is an estate involved, and those things are going to come to light as a result. If there is a major credit card debt and there are no assets in the estate that can pay for it, then it seems likely that there will be more questions after that. "Are there any hidden assets" can be one of those questions, and there's certainly a spectrum of answers that varies according to whether those assets might be in the form of a gifted sandwich / some jewelry / a car / a boat, etc. and whether those gifts were legitimate or fraudulent. It will be very hard to get the assets back, but who knows... it might be pretty easy to nail someone with a fraud charge if it was fraud and they were sloppy.
    • Retric 8y ago
      It's a timing question. If the dead person gave away a diamond ring before death then it's not part of the estate and the new owner can keep it without issue. If the dead person owned a ring when they died then it's an asset that can't be passed on until after debts where paid. However, the estate can sell the ring which they still own for what it's currently worth without issue. They just can't give anyone assets until debts are paid. This opens up something of a loophole where family can purchase items of a sentimental nature which are not actually worth much on the open market.
      • yebyen 8y ago
        > This opens up something of a loophole where family can purchase items of a sentimental nature which are not actually worth much on the open market. That seems like not much of a loophole, are you saying for tax purposes? Since the assessed value of a gift might be much higher than the actual purchase price at auction...? The loophole seems to be that they can give the gift when their estate is insolvent, if any loophole exists. (Not saying you're wrong, or that this loophole is wrong.) Or are you saying, it's a loophole because they couldn't normally get those precious things from the estate if it was insolvent, except that their value is mostly sentimental, so they can actually be purchased for a pittance at the inevitable estate auction?
        • Retric 8y ago
          > Or are you saying, it's a loophole because they couldn't normally get those precious things from the estate if it was insolvent, except that their value is mostly sentimental, so they can actually be purchased for a pittance at the inevitable estate auction? This, the estate can't give things away so normally someone would need to payoff or assume debts to get such things. However, if the sentimental value is high on grandma's rocking chair, but it's actual value is low then family can still get it cheap even if it's not free.
  • mattkrause 8y ago
    Wouldn't a loan for jewelry be secured by the jewelry itself, if nothing else? I thought "unsecured" implied that there was no collateral or object that could be repossessed if you failed to pay (e.g., student loans).
    • yebyen 8y ago
      Yes, this. It matters if there is something tangible to be repossessed or not.
    • taejo 8y ago
      Securedness is a property of the loan, not of the thing you used the loan to buy.
      • mattkrause 8y ago
        Sure, but loans for tangible property can usually be secured by the thing itself (assuming it doesn't deprecate, etc), so I think tangible thing==>secured loan is not a crazy rule of thumb. Assuming you could talk a lender into taking the risk, I see no reason you couldn't get an unsecured loan for a car. Obviously, you could put up collateral to secure any sort of loan too.
        • taejo 8y ago
          It's not a crazy rule of thumb at all, but you're more likely to buy jewellery with a credit card than a secured loan.
• sangnoir 8y ago
  > Nobody gets a pass to buy free stuff with their credit cards before they die. While they don't "get a pass", this is something that happens - credit-givers know this and the risk is baked into the price and amortized over the entire card-holding population. A lot of people have delinquent debt and some choose to declare bankruptcy. How do you repossess an expensive luxury cruise, or a stay in Vegas? Some debt is just written off.
  • Gibbon1 8y ago
    It's actually very hard to claw back gifts and almost impossible to claw back things that were sold.