25+ Years Of Legal Experience

How does the probate court handle unpaid debts?

On Behalf of | Aug 31, 2022 | Probate Litigation |

Nobody wants to worry about debt after a loved one passes away. Unfortunately, if a person dies while still owing debt, their creditors will try to claim the money that they are owed. The Maryland probate process dictates how these debts are handled.

The probate process administers an estate

Probate refers to the legal process that most estates go through after someone dies. During the probate process, a person’s will a will be administered and debts will be paid prior to assets being distributed to beneficiaries.

You can make the probate debt process go more smoothly

If a loved one has passed away and you know they have debts, you can make the probate process go more smoothly by making up a complete list of all of their unpaid debts before the probate case begins. Look especially for these types of debts:

  • Mortgages
  • Property taxes
  • Credit card bills
  • Insurance policies and fees
  • Vehicle loans
  • Any lines of credit or loans
  • Utility bills

If your spouse dies, you are not automatically responsible for all of the remaining debt

During the probate process, one of the factors that will be considered is whether surviving family members are still responsible for the debt if the estate is unable to pay the entire amount. In the following instances, you will not be responsible :

  • You did not cosign an agreement.
  • The debt occurred because of fraud.
  • The deceased obtained the debt before marriage.
  • The deceased obtained the debt after a divorce.

Estate planning reduces probate debt stress

Probate can be stressful for all of your loved ones, and that stress only increases if you have unpaid debts. Proper estate planning can help to organize your debts and make the probate process shorter so that your loved ones can focus on helping each other through the time of grieving.