How are Debts Paid in Probate?

There are many steps in the probate process in New Port Richey. One of the most important of these is that creditors can file a claim against the estate to recover debt still owed to them by the deceased. Creditors’ claims must be paid before any estate can be settled and beneficiaries and heirs can receive the property left to them by the deceased. It is important to work with a New Port Richey probate attorney who can help you pay these claims and overcome any challenges that may arise.

What Debts are Paid During Probate? 

Repaying debts is one of the first steps of probate in New Port Richey. Not all debts are created equally under Florida law, though. They are prioritized in a certain order. The most common debts paid in probate are as follows:

• Administrative expenses, such as fees for the attorney and personal representative, as well as court costs
• Taxes, including the deceased’s federal income taxes and estate taxes, if they apply
• Secured debts such as auto loans, mortgages, and more
• Medical expenses, particularly those related to the previous 60 days of illness
• Unsecured debt such as personal loans, credit card debt, and more

Certain debt, such as previously owed federal income taxes and unpaid child support, will take priority over others, such as credit card debt.

How Creditors are Notified

After a personal representative is appointed to administer an estate, they must notify creditors of the death. This usually involves a publication in a local newspaper while written notices are also sent directly to known creditors. The notice will include a deadline, which is generally three months from the time the notice is published or received. If creditors do not file a claim within this time, they may lose their right to file a claim and recover unpaid debt.

How Debts are Paid During Probate 

After a creditor files a claim against an estate, the personal representative must review and confirm that a claim is valid. The personal representative will then repay the debt from the assets within the estate before the heirs or beneficiaries receive any property. Payment of debts follows the order of priority above.

If there are not sufficient funds within the estate to repay all debts, creditors may only receive a partial payment or they may not be paid at all. If a secured debt is not paid, the creditor may claim the collateral, such as a home or vehicle. It is critical that the personal representative keeps detailed records of all payments to creditors, as they may be held responsible for improper management of the estate and protecting loved ones from liability.

Our Probate Lawyer in New Port Richey Can Help

The probate process can be long and complex and personal representatives are usually required to work with a New Port Richey probate attorney. At Messina Law Group, P.A., our experienced attorneys can guide you through the process, ensure all steps are completed properly, and make things as easy as possible for you. Call us today at (813) 492-7798 or contact us online to schedule a consultation and to learn more about how we can help.

Source:

leg.state.fl.us/statutes/index.cfm?App_mode=Display_Statute&URL=0700-0799/0733/0733ContentsIndex.html