Can Children Inherit Debt?
The death a parent can be a difficult time and in the wake of such tragedy, reconciling debt and property matters can seem overwhelming. During this time, you might be wondering, am I responsible for repaying my parent’s debt?
Unless you were a cosigned on for a credit loan with your parent, children are not responsible for paying off the debt of a deceased parent. Typically, repayment of your parent’s debt comes out of the estate. Their debt affects how much inheritance you will receive as all outstanding debt is considered before distribution of inheritance.
For example, your parents may have left you the family home, however, they were in considerable amount of debt when they died. Property is considered an asset of the estate and as the executor of their will, you could be required to sell the home before to repay the creditors.
Despite not being responsible for your parent’s debt, creditors might try to convince you otherwise.
So, what are your rights?
After your mother or father dies, creditors will be notified of the death. They then have between two and six months to make a claim against the debt owner’s estate. Funeral expenses, state and federal taxes are given first priority for debt repayment from the estate. Outstanding loans and mortgages are given second priority to assets. Credit card companies are given last priority for debt repayment from their estate.
If your mother or father passes away and you are left with the responsibility of executor of their will, it is important you consider retaining a skilled Montgomery County probate lawyer to help you through this process. The legal team at Dossey & Jones, PLLC has years of experience assisting clients with probate and estate planning legal matters. Contact their offices to schedule a no obligation consultation. (281) 410-2792