Legal Question in Wills and Trusts in Minnesota
Money owing to deceased
My husband and I borrowed $10,000.00 from his father about 3 years ago. Some had been paid back, but there was a balance owing when he passed away October of 2004. Does that money owing have to be paid to the estate before it can close? He did have a will and this debt was not acknowledged in the will but other family members know that we owed him money. The other family members have there hands out for the estate to close so if we don't pay it back in time and maybe make payments, what will happen to that money, will if be distributed to the other 9 family members every month? Or was this debt buried along with Dad?
2 Answers from Attorneys
Re: Money owing to deceased
Thank you for your question. When your father-in-law passed away, any debts that were owed to him are now owed to his estate. This means that you now owe the estate for the loan you made with him. The personal representative of your father-in-law's estate has a duty to recover debts owed to the estate. The personal representative has to collect debts, he or she generally cannot split up a debt owed to the estate among the heirs. You might have to get a loan from a bank to pay off the estate. You should try to come to an arrangement with the personal representative. As for how the repaid money will be distributed, that is determined by his will.
I hope this answers your questions. If you need any more help, please give me a call at (507) 625-3000 or toll-free at (877) 599-5550.
Regards,
Luke Robinson
Chesley, Kroon, Chambers,
Harvey & Carpenter
Re: Money owing to deceased
As with a lot of other things, the answer here is it depends. To a large extent it is up to the Personal Representative to decide how hard he or she wants to try to collect this debt. If the personal representative thinks it's not worth the effort, he or she can probably close the estate.
This would be easier to do if it's an informal probate. If it's formal, and if the debt was listed in the inventory of the estate as an asset, then the Personal Representative may have to explain to the court why he/she is not trying to collect.
If it is informal, and if the family wants to let it go and close the estate - then that should probably be done. Keeping the estate open can cost money too.
This response is for general information purposes only and does not create an attorney-client relationship. You are advised to consult the attorney of your choice concerning the details of your case.
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