My Macmillan

Loans and cancer

What happens to my loan if I die?

Secured loans

The loan will be repaid from your estate before any surplus proceeds are distributed to the beneficiaries of your estate. The value of the asset against which the loan is secured will usually be enough to cover the debt. However, if the estate is not enough to pay off the whole of the secured loan, the lender cannot ask pursue the rest of the debt.

Unsecured loans

These rank last in terms of priority in terms of repayment on death. If the estate is not large enough to repay a personal loan the lender cannot make a claim on the estate or pursue the family of the deceased for payment.