Losing a loved one is hard enough without the added stress of dealing with their debts. If your mother passed away leaving behind $17,000 in credit card debt, you may be wondering if you'll have to sell her house to pay off creditors. Here's what you need to know.
Is the Debt Yours?
In most cases, family members are not personally responsible for the debts of a deceased loved one. The debt will typically be paid from the deceased's estate through the probate process.
Probate and the Estate
During probate, the executor will use the assets in the estate, like cash or investments, to pay off debts. If the estate doesn't have enough liquid assets, real estate like a house may need to be sold to settle remaining debts, including credit cards.
Will the House Be Sold?
Whether or not the house needs to be sold depends on a few factors:
- If the house is solely owned by your mother, it's likely part of the probate estate and may be sold to cover the debt.
- If the house is jointly owned or passes outside of probate (such as by joint ownership or through a trust), it may be protected from creditors.
- The existence of other debts, like a mortgage, could also impact whether the house needs to be sold.
Next Steps
To understand your situation, review your mother's estate plan and consult with the estate's executor. If needed, consider talking to a probate attorney to understand your rights and options. Creditors may also be open to settling for less than the full amount, especially if the estate's assets are limited or tied up in real estate or other tangible assets.
Final Thoughts
While creditors are entitled to be paid, you're not personally responsible for your mother's credit card debt unless you co-signed. The estate may handle the debt, and whether the house is sold will depend on how her assets and estate are structured. Generally speaking, it is smart to contact the creditors to see if they are willing to compromise the amount owed. In many cases they will agree, on the condition that they get paid right away. Consulting a probate attorney can help clarify the best course of action.
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