What Happens If You Have Unpaid Bills When You Die?

In most cases, people do not know when they are going to pass away. Even if someone is sick, nobody can tell exactly when their last breath is going to be. Therefore, a person may have unpaid bills. Probate allows for the debts to be paid when a person passes away before the distribution begins. The funds and assets are used to pay off all the debts first. 

If your loved one has passed away and has debts left to pay, you may be confused. You might be wondering about dealing with these debts while handling probate and your family. You do not have to go through this alone. You can hire an attorney to give you peace of mind and navigate the complexities following someone’s death. 

How do you find out if a deceased person owes someone money?

The executor is burdened with the responsibility of finding out who the deceased individual owes money to, even though it can be a challenging and time-consuming task. To do this, one has to go through the incoming and outgoing messages, emails, calls, and other records of the person. There may be physical documents of debts as well. 

First of all, credit card bills, car loans, personal loans, mortgage loans, medical bills, or other invoices should be looked at. These are some of the common debts people have. The executor must make a list of all the pending debts. If the deceased owned a business, the executor should also look for business-related loans. 

Who pays the debts?

This is a common question because nobody wants to inherit someone else’s debts. Do not worry. When you pass away, your family members won’t be burdened with your debts. Rather, you will pay them. 

The burden of the debt falls on the deceased person’s estate. The executor or trustee will first use your assets to pay off any debts you have before the distribution process can begin. Apart from cash, the estate’s things, such as jewelry, artwork, or any other valuables, will be sold to clear the debts. The leftovers will be given to the heirs. 

In some cases, there is not enough money to pay the debt. In this case, the estate won’t be automatically passed to the beneficiaries. This just means that the family won’t receive anything. 

Can debts be forgiven?

Yes. There are exceptions to the debt-paying rule if the debt is too much of a burden on the estate. However, this rule typically only applies to medical bills and probate fees. You can speak with an estate attorney to know more. 

Dealing with unpaid bills following the death of a loved one can be overwhelming. If you are dealing with a similar situation currently, hire an attorney today. 

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