Probate Claims: How They Work
The probate process is nothing more than a very step-by-step, methodical way of
dealing with all the property a deceased person left behind. Part of this process
involves paying back any money the deceased person owed. As part of repayment,
the person who manages the estate, known as the personal representative or the
executor, will have to contact creditors or notify them that the estate is open and
that they need to submit a claim if they want to be repaid.
Though state probate laws differ significantly, informal probate the executor will
have to file a notice. This notice is typically published in the local newspaper of
record for a number of weeks, and may also be posted in public places such as a
courthouse or local city hall.
Any creditor who was owed money by the decedent must, after learning the estate
has been opened, file a claim with the executor. It is then the executor’s duty to
ensure that the claim is valid and determine when the creditor gets repaid. State
laws establish a list of what creditors get repaid and in what order. As long as the
estate has enough money to repay all creditors, all of them will get repaid. However,
if the estate doesn’t have enough money, some creditors will not get repaid. It is up
to the executor to determine which creditors get paid first and, if the estate is
insolvent, which creditors lose out.
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