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Managing Debt Collection During Probate

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The average U.S. household has over $16,000 in credit card debt, which is 10 percent higher than a decade earlier, according to Time, and the average mortgage debt per household is over $180,000, according to USA Today. Because the average American dies with considerable debt, paying off collectors can be one of the more challenging aspects of probate. After the death of a loved one, the last thing that family members want to deal with are harassing debt collectors. Unfortunately, parties that were owed money by your loved one will typically go to great lengths to ensure their debt is paid, even if the debt was not secured. This sometimes involves using deceptive language and practices to trick mourning spouses or family members into handing over money that they are not responsible for paying. As a family member, spouse, or friend of the deceased, you are never responsible for using your own finances to pay off a debt of your loved one.

Generally, Creditors Can Only Collect Assets From Probate Property

Are you worried that a particularly demanding creditor will attempt to take property that the decedent did not own? Sometimes debt collectors will attempt to deceive a spouse or family member of the decedent into paying a debt out of their own bank account. Do not be fooled by such claims. Only property that the decedent owns will go through probate, and creditors can only go after probate assets, not yours. However, if the decedent had a joint bank account–something that would not go through probate and would pass directly to the other bank account owner–a creditor may be able to pursue the finances in this bank account. An attorney can make sure that you only pay debts that you have to, and that if the estate only has enough money to pay off some of the many debts, that you pay off the correct ones first. For example, a secured debt, such as a mortgage, must be paid off before an unsecured debt, such as credit card debt.

Avoid a Potential Lawsuit by Consulting with an Attorney First

As an executor of the estate, there are many ways in which you can quickly land in hot water. One of these is to distribute property to beneficiaries before outstanding debt has been paid. In this situation, the creditor can file a lawsuit against you personally, or against the beneficiaries to return the property. An attorney can help you out of this situation, or avoid it in the first place.

Call Maryland Probate Attorney Tara K. Frame Today

An experienced probate attorney can help you discern what debts need to be paid, which creditors or parties can be ignored, and how to properly distribute assets to beneficiaries without worrying about legal repercussions down the road. Furthermore, a Maryland probate attorney can make the pestering phone calls stop, and force abusive debt collectors to stop their unlawful practices. The probate attorneys at Frame & Frame can begin helping you today. Call us to schedule a consultation.

Resources:

usatoday.com/story/money/personalfinance/2017/11/18/a-foolish-take-heres-how-much-debt-the-average-us-household-owes/107651700/

time.com/money/4607838/household-credit-card-debt/

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