Family members do not inherit debt. However, this does not mean that your friend's creditor has no recourse here.  The assets of the estate (i.e. car) may have to be sold in order to satisfy creditor claims. Only after the debts are paid will the remaining assets be distributed to the heirs (in this case your friend's son). If the sale of the assets (i.e. the car) are not enough to pay off all debts, then any debt remaining extinguishes as a matter of law (i.e. are written off).