What happens to a personal loan if the borrower dies in the Philippines?

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In the event of a borrower’s demise in the Philippines, the fate of a personal loan comes under scrutiny. Personal loans, akin to credit card debts, are commonly unsecured, indicating that their repayment hinges on the assets within the debtor’s estate.

However, it’s worth noting that settling the remaining balance might not be guaranteed, as personal loans typically rank lower in priority compared to other financial obligations. The probability of the loan being repaid heightens if there exists a co-signer or co-borrower capable of assuming responsibility for repayment.

In such cases, the burden of settling the loan may shift to the co-signer or co-borrower, potentially mitigating the risk of default.

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CashLoanPH Changed status to publish 09/04/2024