Paying Debts During Probate
Keeping up with payments on your own debts is hard enough. How do you assume responsibility for someone else’s debts, especially when that person is no longer around to fill in missing details about his or her financial situation? This is what the personal representative of the estate must do in every probate case. Sometimes the task is more straightforward than it is in other cases. If the decedent kept careful written records of his or her budget and expenses, including debt payments, then the debt settlement process is simple. Things are more complicated if there are debts that you did not know about until the estate opened for probate, if there is room for disagreement about how much, if anything, the decedent owed to the creditor, or if the debt balance is so high that the estate must sell real estate properties or other assets to settle the estate’s debts. Whether debt settlement in your probate case is a routine matter or a legal nightmare, you, in your capacity as the personal representative of a deceased person’s estate, always have the right to hire a lawyer. For help settling debts owed by an estate, so that the heirs can receive their inheritance, contact a Washington, D.C. probate lawyer.
Debt Repayment Responsibilities of the Personal Representative
When you open the estate for probate and the court officially appoints you as the personal representative, you must contact all the heirs, including beneficiaries of the will, as well as disinherited close relatives of the decedent. You must also contact all parties to whom the decedent owed money; you can find out who these are by collecting the decedent’s mail and contacting the companies that send bills. Finally, you must post an announcement on the website of the local newspaper, notifying the public that the estate is open for probate, so that anyone who wishes to do so may contact you about an inheritance or debt repayment that they believe they are entitled to. Probate claims from complete strangers about debts or inheritance are a hassle, but they are rare. Most likely, the creditor claims will come from creditors who were a source of the financial stress for the decedent in his or her old age.
Ideally, you can just pay the face value of the debts out of the estate’s funds, but not all estates have that much money. You might need to sell assets to pay the debts, which sounds simple, except that the beneficiaries of the will must authorize the sale before it can proceed. The worst-case scenario is that the estate settles insolvent, with creditors taking everything and leaving the heirs empty-handed. If it is any consolation, creditors cannot touch life insurance policies and other assets that the heirs inherit outside of probate.
Contact Tobin O’Connor Concino P.C. About Probate Creditor Claims
A Washington, D.C. probate attorney can help you resolve legal disputes related to the decedent’s outstanding debts. Contact Tobin O’Connor Concino P.C. in Washington, D.C. or call 202-362-5900.
Source:
msn.com/en-us/money/personalfinance/my-mom-died-with-no-will-and-6-000-in-credit-card-debt-my-uncle-says-i-should-pay-the-debt-because-i-collected-her-life-insurance-what-do-i-do/ss-AA1Ulc0S?ocid=msedgntp&pc=ACTS&cvid=696a704e17264cbbbbca021938104f0a&ei=30#image=6
