In the days of the pandemic of Covid-19Banks’ customer advisory bodies report increases in inquiries about what to do when the holder of a loan dies and if they should continue to pay the loan.
Given the sanitary conditions, it becomes uncollectible for the bank and is settled once it is reported by the family of the deceased. At the same time, it can imply direct benefits for the debtors if the procedure to activate the insurance with which most credits are followed is followed.
According to the General Director of Debtor Defense, Angel Gonzalez, practically none of the debts is inherited when the borrower dies and, in the scenario of health contingencyhave received a high number of requests for advice on what to do when the person responsible for a loan dies.
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The specialist explained that in this type of case, family members are suggested to mourn calmly and then notify the bank with the death certificate that the owner has died. In most cases, the debt disappears upon the death of the person who hired, and if the credit had some type of insurance, it can be beneficial for the debtors.
“Some family member can go to the bank branch with the death certificate and official identification and let them know that this tragedy happened, that unfortunately the person died, especially right now, which is common with Covid-19. There are many cases of people who have this situation, ”said González.
On the subject, the main banks operating in Mexico highlighted that a loan is no longer charged when notified of the death of the holder and depending on the product an insurance is activated.
“In the case of mortgage loans, they have insurance. Upon the death of the client, the insurance covers the entire balance and the property is released in favor of the beneficiary, so that no debt is inherited.
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“The same insurance model applies to personal credits, in which before the death of the client the bank extinguishes the debts once it is notified, so that no family member must face a debt. In both cases it is important that the insurance premium is up to date ”, he announced Santander.
In the case of Credit cards, CitiBanamex He explained that there is a death debt release insurance, which covers the total debit balance that the client had at the time of death.
“The protocol that is applied is that the client’s relatives must report the death of the cardholder at any branch. Present the original death certificate or certified copy of it, a copy of the official identification of the client who died and the official identification of the family member who is reporting the death, ”he said.
About the topic, HSBC He commented that since there is no express statement of the reason for death by the debtor, there are no specific figures that indicate a relationship of death from Covid-19. No credit is inherited, because having insurance, before the death of the client the debts are settled.
“In all cases, there is at least a month of delay between the dates of death and notification to the bank. Once the process is confirmed, the debt is settled ”, he explained.
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Relevance of the will
For its part, Banorte recommended that users always have a updated will, as this will facilitate any process for your beneficiaries in the event of an unfortunate event of death.
“The credits do not fall into default since the debt is forgiven. When the person dies, the credit is not charged to anyone. From the second cycle, the client is entitled to life insurance, which in the event of death is delivered to the beneficiaries designated by the deceased client.
“If the client had contracted protection insurance, the corresponding insured amount is paid. It is important to mention that for this to happen, the original death certificate or certified copy must be delivered to Compartamos Banco, ”Gentera, a bank specialized in microcredits, explained separately.
At the close of the first semester of 2021, the NPL ratio (IMOR) of the consumer credit portfolio of the 51 banks operating in Mexico reached 3.93%, with an annual reduction of 0.45 basis points.
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For its part, the IMOR of home loans stood at 3.60%, 0.46 basis points more than in June 2020.
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