The debts against an estate must be paid upon the death of a person. The executor of the estate is responsible for making sure those debts are paid in Maryland and across the nation. Part of the estate administration is to pay the people and the institutions that are due money from the estate.
The task can be overwhelming, especially considering that most executors are also having to deal with the recent death of someone they loved. Following the right procedure is extremely important to ensure that creditors are paid and that the remaining funds go to the right people. This is also to ensure that there are no unnecessary problems or expenses.
The executor must notify the creditors of the deceased. Unknown creditors can sometimes be notified through a notice of death in the local newspaper. The executor may also need to comb through the deceased's important papers to find all of the creditors. Known creditors should be notified through the mail.
Creditors can file a claim against the estate, but the time they have is limited and varies from state to state. There are sometimes exceptions to that time limit for claims such as state and federal taxes or property liens. Once filed, the executor can either reject or accept the claim, but if it is rejected the creditor may sue the estate for payment.
It is important that all of Maryland's laws are followed when distributing funds from an estate after the death of a loved one. The executor should be someone who is trustworthy and can handle multitasking to get the job done in a timely manner. Those who would like to name an executor for estate administration may wish to speak to an attorney who can help fill out the correct forms and make them part of the estate plan.
Source: elderlawanswers.com, "How Do an Estate's Debts Get Paid?", June 23, 2015