When we die, the estate that we leave behind goes through a process known as probate. It is during this process that any outstanding debts one may have owed will have a chance to be satisfied from his or her estate. In other words, the executor of an estate (i.e., the person responsible for “wrapping up one’s estate”) has a duty to try and take care of any outstanding debts, but, in order to do so, the executor or must have notice of that outstanding debt.
1. How do I let the executor know I’m owed money?
After a person dies the executor of that estate, or the probate court having jurisdiction over the matter, will issue a Notice to File Claims – also known as a Notice to Creditors – in some sort of publication, usually a local newspaper.
2. Is this approach the same in every state?
No, the law surrounding probate varies from state to state, so be sure you know what that law is in your jurisdiction. While some jurisdictions only require the Notice to be published in a newspaper, others allow for such a Notice to be mailed directly to known creditors. Still other jurisdictions, such as New York, do not require any notice to be given to a creditor. The reason for this is that the New York assumes that creditors exercising due diligence will inform the executor of the claim via their standard collection methods; once informed, the executor has a legal duty to try to satisfy the debt.
Latest posts by Michael Robinson, Estate Planning Attorney (see all)
- Beneficiary Designations, etc., Aren’t a True Substitute for a Trust - April 17, 2019
- What Are 529 Plans and What Are Their Advantages? - April 17, 2019
- Have You Heard of These Trusts? - April 16, 2019