Probate can feel overwhelming because of the lengthy process that survivors have to go through. However, it might be worth remembering that probate law came about as a way to ensure that those owed money by the deceased could be paid. With that in mind, no other legal action comes close to dealing with estate debts as probate does. In some cases, the personal representative is charged with the task of handling some debt payments. To find out what to expect in terms of paying debts, read on.
Get an Idea of Estate Debts – In many cases, the personal representative is a close family friend or a relative of the deceased and may have an idea of the debts to expect. However, it can be surprising to some when they find out that the deceased owed more money than expected. The probate court needs to know about any and all debts owed, so locate the paperwork, bank statements, online accounts, check registers, and other important indicators of bills being paid as soon as you can.
List All Debts – Next, make a list of all creditors, account numbers, and the balance owed. The probate lawyer for the estate will guide you to what needs to be paid and when. Do not, however, just start writing checks to pay bills. That is because there are bills that can wait, that cannot wait, and that don't ever have to be paid, and only the lawyer knows what those three categories apply to. Don't overlook tax debts, utilities, and more.
Know About Two Debt Categories – As mentioned above, debts are not all equal in importance to the probate court. Administrative debts are often paid while probate is still ongoing. They mostly include debts meant to protect and preserve other estate property. Examples of that might be mortgages, storage facility fees, lawn mowing, repairs to the home, and more. Some utility bills fall into the administrative category too. Final estate bills can wait until probate is over and include things like taxes, loans, etc.
Pay Bills Appropriately – As the personal representative, you are required to pay some bills, but you don't have to use personal funds to do so because the funds should come from the estate. Bank accounts and other liquid assets may be used and property can be sold if needed. However, keep in mind that probate decides who has to be paid, and they are not likely to impose a hardship on the survivors when it comes to low priority bills like medical debts, credit cards, and personal loans.
Speak to a probate lawyer to find out more.
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