What is the relationship between debts and heirs upon a person's death?

When a person dies, their debts do not simply vanish; instead, those debts become part of their estate and must be settled before any distribution of assets to the heirs. The correct understanding is that the debts of the deceased are passed to the estate, and the responsibility to pay them lies with this estate.

In most jurisdictions, heirs are not personally liable for the deceased’s debts beyond the value of the inherited assets. This means heirs can only lose what they inherit if the debts consume the assets. If the estate has enough assets to cover the debts, the creditors will be paid first, and the remaining assets can then be distributed to the heirs.

The other options present misunderstandings about how debts are handled posthumously. Debts are not erased upon death, as indicated in the first choice; rather, they must be paid from the estate. The suggestion that heirs only pay debts if there are assets implies a level of liability that does not accurately reflect the broader principle, while a focus only on joint debts overlooks the complexity of individual responsibility regarding all debts of the deceased. Therefore, the understanding that debts are passed to heirs upon death, and must be managed as per the estate law, outlines the correct relationship between debts and heirs.