What happens to personal loans when the borrower dies?

When a personal loan borrower dies, the loan is typically paid off by the person’s estate. It is not forgiven or discharged at death, and still must be repaid from any money or property left behind. If there isn’t enough money to pay it back, the loan will typically not be repaid, unless it was a joint account. In most cases, debts of someone who dies don’t become the responsibility of heirs if there isn’t enough money in the estate.