probate

[Taurice Cooper]

Good afternoon BP family! My question has to do with probate.  When there are various claims against a decedents estate and the estate controls real estate,does this force the  property to have to be sold , puts a lien on the property, or just puts the debt on the person made to legally handle the affairs of the estate ?

[Jerry W.]

@Taurice Cooper  probate is usually just the passing of property from a deceased person to another that requires court action to do it.  It is possible for creditors to initiate probates if no one else will do it and they have a claim.  The preferred way for a probate to go is for liquid assets to pay off all debt then transfer all property free and clear to the heirs.  When there is not enough money to do this usually property is sold to pay debts.  If there are a lot of heirs and only one or 2 properties it is usually sold and the proceeds divided.  Debts can be mortgages on property, medical bills, credit cards, even the costs of burial or running the estate.  It is possible for an estate to take out a loan, usually secured by real property, to pay debts, but the preferred way is to liquidate property.  A probate court cannot cancel a recorded mortgage like a bankruptcy court can but they can permanently bar unsecured claims against the estate.  Heirs do not like waiting 6 months for property to sale at full value, and often no one wants to come up with money to fix up property prior to selling it so properties often go lower than normal sales.  If the person was elderly or had large medical bills often the properties are distressed from lack of maintenance and care.  The worst scenarios are when no one can find an heir.  If no one does the probate the property deteriorates rapidly and is often sold for unpaid taxes.