[lbo-talk] Debt

Wojtek S wsoko52 at gmail.com
Thu May 3 08:15:00 PDT 2012


Doug: "In Japan, during the 1980s bubble, there were "two-generation" mortgages, in which children inherited the debts of their parents."

[WS:] I would like to see more details on that. 'Inheritance of debt" is possible in many civil law countries under the general inheritance laws i.e. when you make an inheritance claim to an estate you automatically inherit the debt associated with that estate, but this happens only if you make that claim. If you do not, you do not "inherit" the debt either.

For example, if my parents die and own real estate and also unpaid debt I have to choices: either inherit the real estate plus debt (i.e. pay it off) or walk away from the whole package. I know that because I went through the process not long ago. Although my deceased parents had no debt, this had to be established in court. I also know of other people who walked away because of the debt.

I suspect that something similar must exist in most countries, including the US. In general the US has more lenient debt forgiveness laws than EU but I do not know about Japan.

-- Wojtek

"Modern conservatism is just a neoliberal gloss on medieval domination."



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