Process Creditors

You’ve heard the saying “The only sure things in life are death and taxes”.

Perhaps “Creditors” should be added somewhere to that proverb, because they will not only follow you in life, unless you have filed bankruptcy, they will come seeking repayment after you have passed on.


Debt is virtually inescapable, even if you leave this mortal coil.

Make no mistake, creditors will come calling to collect upon notice of your passing, but for those who still owe unpaid debts t at the time of their eventual demise, there is potential good news. They can be a hassle to deal with, but it’s part and parcel of the probate process.

For those who are certain they have left an airtight will be certain you also leave little or no debt if at all possible.

Most of us are afforded the opportunity to live a full life (premature deaths make up for less than ten percent of the world’s population, even in countries with low life expectancy rates), so there is ample opportunity to get one’s affairs in order when the end is near.


During the probate process in most states, debts are usually squared away by the court appointee or the executor if one is named in the will. To ensure this is done, most state laws require notice be given to creditors so they can respond in a timely manner.

The good news is that when the notice of creditors goes into effect, creditors have a limited time to respond with a claim or they are forever barred from further attempts to collect. This means that debts cannot be collected from relatives, must be paid out of the estate, and only if the creditor’s claim is deemed valid by the court overseeing the probate. It is during this time period in a probate process that funeral expenses, taxes and other obligations are paid for from the estate of the deceased.

When considering a probate case, it is a good idea to investigate whether the deceased owed money, to whom, and how much. There have been instances where some have paid debts in advance in order to free up an asset such as property or a vehicle. While payments will be gladly accepted by creditors in such cases, this does not automatically mean the property or the vehicle will be designated as transferable to the person who paid off the debt.

If a house is secured by a mortgage, the banks may not be helpful if the house requires capital improvements to realize its full potential value to the heirs. There interests go no further than the value of the loan outstanding. Depending on the Chrysalis factor ==> , is cash a deal or not a deal, beneficiaries may be well advised to ask probate to accept a cash offer for the home.

A person must consider a variety of factors, particularly costs, for legal costs are the responsibility of the person who launches a petition for probate. These costs do not come out of the estate and include court fees, attorney’s fees, personal representative fees, appraisal and valuation fees (i.e. how much a piece of property left by the deceased is worth), bond fees, and miscellaneous fees such as the cost of postage when notifying creditors of a petition of probate.

As for the actual costs to conduct a probate case, it varies from state to state but a general rule of thumb is that probate costs which the petitioner must assume tend to amount to 3-7% of the estate’s overall value.


Our purpose in publishing the above information is to persuade you make a will if you do not have one, or to keep your will up to date if circumstances in your life have changed. This will help your beneficiaries cope after you are gone, and in many cases avoid considerable unforeseen strife among your heirs.

If you have not yet done so, please consider an end-of-life plan that includes a standing will; it’s peace of mind for you, and those who outlive you.

Get Smart about Probate™