after a person passed away his personal loans are closed

1. Loan given by Banks /Financial Co., shall be recovered from the legal heirs of the deceased person .OR. by attaching any available residual property of the deceased.  

2. Loan outstanding to any alive or dead person CANNOT be closed automatically, till due procedures of law is conducted by the financing agency.

Keep Smiling .... Hemant Agarwal
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If the person who availed loan has not given any collateral security or surety for the loan, then we can assume that the loan is closed but if he has any  any property on his name and if it is know to the  creditor then the loan  can be realized by way of  court attachment and sale. For the legal process the creditor has to initiate the process with in 3 years of the date of knowledge of the person who has availed the loan.