Handling the debts someone has when they die is a big part of your responsibility as the executor of their estate. In fact, this obligation is a source of one of the biggest risks of being an executor. If you don’t properly repay creditors, they can sometimes hold you accountable for the testator’s debts.
Some accounts and debts you will easily locate when you go through the testator’s financial records. You may also receive statements in the mail from medical care providers, credit card companies and others owed money by the deceased.
Others can be harder to locate, especially if the testator didn’t have one cohesive collection of household financial records. Understanding your obligation to notify creditors can help you avoid the liability that sometimes comes from estate administration.
How do you notify unknown creditors?
It can seem like an impossible requirement to locate people and businesses about debts that you don’t know about, but there’s a simple process for notifying them. Pennsylvania probate law sets specific rules regarding the notification of creditors.
The executor of an estate needs to publish notice of estate administration in not one but two newspapers circulated in the county where they lived. One paper must be a general circulation newspaper read by the average person, and the other must be a legal publication. The notice should appear in the paper for three weeks.
Once the executor takes this step, the countdown for creditor claims begins. Creditors will have up to one year from the date of the publication of that notice to bring a claim against the estate. After that year passes, the executor will then be able to distribute the property from the estate to the beneficiaries.
Following the right procedures will eliminate the potential liability that an executor has for unpaid debts during estate administration.