The death of a loved one is painful enough without having to worry about paying the funeral expenses. But funerals cost an average of $7,640 in the United States, and many families struggle to cover the sudden costs. What happens if you simply can’t afford to pay the funeral bill?
Unfortunately, there can be serious consequences for non-payment of a funeral bill. Funeral homes provide an essential service, and they expect to be compensated. Let’s break down what could happen if a funeral bill goes unpaid
Initial Late Fees and Interest
Like most businesses, funeral homes will charge late fees if the funeral invoice is not paid on time The fees are typically 1-15% of the outstanding balance per month. The funeral home may also start charging interest on the unpaid amount. Rates vary but may be 1-2% per month.
These extra fees can quickly add up, increasing an already unmanageable bill. It is best to discuss payment issues with the funeral home right away rather than letting it spiral.
Collection Agency & Damage to Credit Score
If a funeral bill remains unpaid after repeated attempts by the funeral home to collect they will likely turn the account over to a collection agency. The account then appears as a derogatory mark on your credit report damaging your credit score.
Collection agencies are aggressive in recouping debts. They may sue you or attempt to garnish your wages. Your credit score could be impacted for up to 7 years.
Legal Action
Funeral homes can take legal action if a bill is left unpaid. They may file a lawsuit against the person who signed the funeral contract to recover the costs. If they win a judgement, the person would be legally required to pay. Failure to do so could result in wage garnishment, property liens, or bank account levies.
Getting an attorney may be the only way to fight the lawsuit. But legal fees also quickly become expensive. Owing a funeral debt can turn into a lengthy legal mess.
Refusing to Release the Body
The funeral home may not bury or cremate the body until the bill is paid in full. By law, they can keep the body until they are paid for the services they agreed to provide.
Families could be faced with the painful reality that they cannot lay their loved one to rest. Meanwhile, the funeral home will continue charging storage fees as the body remains in their refrigeration unit.
Releasing the Body to the County
If the funeral bill remains unpaid, the funeral director may release the body to the county after a certain time period. The county would then carry out disposition of the body, typically cremation or burial in a potter’s field at public cost.
For families already grieving a loss, the thought of their loved one being cremated and buried without their involvement could be terribly distressing.
Tips for Paying a Funeral Bill
If you’re worried about paying for a funeral, don’t panic yet. You have options:
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Ask about payment plans or pre-need arrangements that distribute costs over time.
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See if the deceased had a pre-paid funeral plan or life insurance to cover burial costs.
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Check for financial assistance programs like Social Security death benefits, veteran’s benefits, Medicaid funeral benefits, or nonprofit groups.
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See if relatives can contribute or organize a fundraising campaign. Crowdfunding sites make it easy to request donations.
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Talk to the funeral home director openly about your financial limitations and ability to pay. They may work with you.
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Consider lower cost funeral alternatives if funds are extremely limited. Direct cremation or immediate burial avoid ceremonial costs.
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If utterly unable to pay, the county/state will carry out disposition as a last resort. Check if any help is available to pay their fees.
The Takeaway
The consequences of not paying a funeral bill can be severe, from damage to your credit and finances to legal action or the unthinkable loss of a loved one’s remains. Therefore, it is crucial to communicate with funeral directors and exhaust all options so that paying the funeral invoice does not become an impossible burden at an already devastating time for your family. With planning, assistance programs, and compassion from the funeral home, paying the bill does not have to lead to further heartache.
A personal loan for the funeral
If you have a good credit score, you might consider taking out a personal loan to finance the funeral costs. Many traditional lenders will not usually loan money for a funeral, but there are institutions that offer or even specialize in funeral loans. Ask your funeral home if they have a funeral lender that they work with. These loans will often have favorable terms like no interest for several months or no-penalty early repayment, but like most personal loans, the interest rate can be high.
Avoid taking out an advance on your credit card to pay for the funeral. This can leave you in even more debt and paying massive interest.
Options for funding a funeral
- Ask your loved one’s family and friends to help chip in.
- Their religious community may be generous, or consider setting up a GoFundMe.
- The funeral home may be willing to offer a payment plan, or to change the arrangements to reduce costs.
- Consider getting a funeral loan. These often have favorable terms, but high interest rates.
When someone close to you passes away, there are many financial responsibilities that suddenly must be handled on their behalf. Perhaps your loved one had an insurance policy or a prepaid plan set up to cover the costs of things like their funeral and burial. Otherwise, all of these immediate expenses will have to be paid out from their estate.
If you find yourself in the position of having to pay for a funeral for your loved one, you might not have the time to come up with a financial plan beforehand. You may assume that the estate will cover the costs of the funeral, but, in the urgency to plan it, you didn’t have time to check the total value of the estate’s assets. So you sign the funeral home’s bill, expecting that it would be paid for, and only later find out that the estate has no assets. Now what do you do?
First of all, know that this is not something anyone can blame you for. Dealing with the death of a loved one is an incredibly difficult and emotionally overwhelming thing, and all the bureaucratic processes that follow can be exhausting and confusing. In such situations, things don’t always run smoothly, especially in financial areas. It’s totally understandable—and you will be able to work it out.
If you signed paperwork with the funeral home, you are financially responsible for the funeral. The average funeral, including all related expenses, will cost between $6,000 and $10,000, with the average being around $7,000. This is a large financial burden to shoulder unexpectedly, but you do have options.
First of all, you may be able to speak with the funeral director to see if you can alter the preparations for the service to lower the cost. Many funeral homes will work with you to get the cost down as much as they can, while still offering a simple but elegant service.
Note that cremation is much less costly than a burial, and can lower the total price by several thousand dollars, as you will not have to factor in the purchasing of a casket or burial plot. If cremation is a possibility for you, your family, and your loved one, consider asking the funeral director about changing to this option.