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Will Your Debt Die With You?

By October 23, 2017August 6th, 2019Estate Planning, Probate

Will your debt die with you?

The short answer is probably not.


In Michigan your estate is still required to pay your financial debts in most circumstances. This is true whether or not you have a Will. The primary benefit of having a Will is the ability to select a personal representative. This personal representative will be the person who will receive any formal claims against your estate from your creditors. Your executor will have the option to pay certain debts or dispute claims. These debts will have to be dealt with regardless of what previsions are made in your Will.

If a friend, family member, or other individual is jointly liable for any or all of your unsecured debts, such as credit card bills or personal loans, they will become responsible for paying off the debt upon your death. However, if you were solely responsible for that debt, your estate may be liable for paying it off.

The personal representative will be required to put Creditors on notice regarding the opening of the estate. This requires that publication be made for any unknown creditors, and that personal notice be given to any known creditors. Creditors will be required to file claims within the prescribed time period. If the creditor fails to notify the executor of their claims after the deadline passes, the creditor’s claims will be unenforceable. If the personal representative fails to publish for unknown creditors, creditors have three years from the decedent’s date of death to bring claims against the estate Also, if there are not enough assets in the estate to satisfy a validated debts, your creditors may have to settle for a lesser amount, or oftentimes, nothing at all.

When a person dies, the Personal Representative of the estate must publish a notice in the newspaper for “unknown” creditors. Generally, this is done in the legal newspaper of the county in which the decedent lived. The publication must notify estate creditors to present their claim(s) within four months after the date of the notice’s publication, or they will be forever barred.

If the debt is secured, i.e. a mortgage on a house or a car loan, that debt must be repaid or the lender has the ability to repossess the assets used the secure the loan. These debts are generally evaluated on a case-by-case basis depending on the value of the asset, the amount owed, and whether any of the heirs want to attempt to preserve the assets.

Lastly, if you die without a will, and no heir or family member petitions the Court to open your Estate, your creditors can file a Petition for Probate and seek the appointment of a personal representative in order to attempt to collect debts. If you have any significant debt, it is advisable that you speak with an estate planning attorney concerning your assets and figure out what effects your debt could have on your estate. Call us at Hewson & Van Hellemont, PLC, at 248-968-5200 to discuss your options.

Bruce Rice

Bruce Rice a graduate of Wayne State University Law School practices Family Law, Estate Planning and Probate Litigation and Administration. View Profile

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