Troubleshooting Legal Problems

How do you handle a decedent’s debts during probate proceedings?

Debt is a common part of modern life, and most people will still have outside financial obligations left unpaid when they die. Those responsibilities will pass to their estates. The executors or personal representatives managing probate proceedings in Pennsylvania have a duty to fulfill someone’s final obligations and carry out their last wishes.

As the representative of someone’s estate, you will have to locate and distribute their property according to both state law and the deceased’s testamentary documents. Before you set about establishing a scholarship fund as requested in the will or distributing property to family members, you will first have to pay off the decedent’s creditors.

What does that process typically involve?

You must publish notice of the estate

Pennsylvania’s law actually puts some of the responsibilities for debt claims in probate on the creditors. The personal representative of the estate must publish notice of probate proceedings so that creditors also have an opportunity to make a claim against the estate.

Those owed money by the deceased will have a full year to make claims in probate court. The probate court will gather all of the creditor claims and expect you to allocate estate resources to pay them in full. Only after the window for creditor claims closes is it safe to distribute property elsewhere.

You must pay all of the valid probate claims made regarding debts before you distribute property to beneficiaries. Failing to follow the correct procedure when it comes to debts in probate court could lead to financial liability for you as the executor. Repaying creditors is one of the most basic and important responsibilities during probate administration.