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Dealing with a decedent's debt during probate

Millions of Americans carry debt, and many people will pass away owing at least some money. This could be in the form of a mortgage, credit card debts, personal loans or other types of liabilities.

After a person passes away, it will be necessary to determine what debts he or she has and how to resolve them. 

What are valid debts?

One especially important step in probate is to identify the decedent's debts. This happens by notifying creditors of the person's death via newspaper publication or certified mail. Creditors then have a certain amount of time to present a claim against the estate. These time restrictions vary by state; Florida laws can be found here.

If a creditor files a claim, the executor of the estate will determine whether the claim is valid. If it is not valid, the executor can reject the claim. A court will have the final say, though.

There may also be situations where creditors are calling a decedent's loved ones claiming they have an obligation to pay off the person's debts. However, it is crucial that someone in this position speak with an attorney before making any payments on another person's debts. Often, there is no legal duty to do this.

Resolving debts

If there are valid claims against the estate, the executor will address them. Typically, this means paying off the debts from the estate. In some cases, a beneficiary will pay down debts, though this should only be done after consulting an attorney. However, co-signers on a debt can expect to repay any debt the estate does not cover.

The exact parties responsible for repaying debt depend on the specifics of the case, as well as any estate planning decisions the decedent may have made to shield parties or properties from debt repayment.

This blog post is to provide a very brief overview of dealing with debt during probate. Often, these claims are quite complicated and nuanced, so specific legal guidance will be critical for anyone with questions about whether a debt is valid and how to repay such obligations.

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