Dealing with Creditors in Probate: FAQs (Pt. 3)

September 25, 2014 Posted In Creditors and Probate,Probate, Estate, & Trust Administration
by Colorado Estate Matters

Wrapping up our blog series Dealing with Creditors in Probate: FAQs, below we will answer some final questions regarding creditors and probate.

Additional Answers to Questions about Handling Creditors in Probate

Q – When can a creditor’s claim against an estate be extinguished or shutdown?

Not all creditors in probate will have valid claims. Knowing when to shutdown illegitimate debt claims can help you preserve an estate’s assets for the people who deserve them.

A – In a few different cases, with the most common of these being:

• When a creditor’s claim against an estate may be fraudulent
• When the debt was already repaid (and the creditor may be mistakenly claiming that the debt is outstanding)
• When the creditor fails to assert its debt claim within the proper period of time after the Notice to Creditors has been published (or after a probate case has been resolved and closed)
• When the creditor fails to file the proper petition after a probate estate has “disallowed” the debt claim (creditors will usually only have about 60 days from the date of the disallowed claim to file a petition to appeal this decision).

Knowing these rules can be pivotal to not paying creditors who have failed to comply with them and, consequently, to preserving the assets of an estate for the beneficiaries.

Q – What if there is not enough money to pay back all of the creditors in probate?

A – When an estate may lack the cash to pay off all of the creditors in probate, it will typically be necessary to start liquidating some (or possibly all) of an estate’s assets to free up funds to resolve all of the estate’s legitimate outstanding debts. As part of this process, the specific assets of an estate will usually be appraised, and then these assets could end up being sold (at, for example, an auction) to obtain funds to pay any remaining creditors in probate.

This process in and of itself can be complicated, so it is best to have one of the trusted and experienced Denver probate lawyers at Colorado Estate Matters, Ltd. on your side to ensure that your best interests, as well as the estate’s assets, are fully protected.

Denver Probate Attorneys at Colorado Estate Matters, Ltd.

Do you need help dealing creditors in probate? If so, you can count on the Denver probate lawyers at Colorado Estate Matters, Ltd. We are committed to providing each of our clients with superior representation and the highest quality legal services, particularly when it comes to resolving probate.

Our goal is to help our clients efficiently navigate the complexities of probate law so they can develop effective, prudent solutions that will protect them, their assets and their families in the future.

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We can discuss your estate planning needs and different options during our consultation. To schedule this meeting, call us at (303) 713-9147 or email us using the contact form at the top of this page.

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