Do my debts die with me is one of the most common questions asked of a probate solicitor. Sadly, like much in law, the vague answer is it depends. The main point to note is that it is the responsibility of your estate is to ensure that all your debts are paid before any money is given to those who benefit under your will, or the closest relatives where there is no will.
The simplest example is a situation where you die with no assets at all and just debt. In this case then your debts die with you. You cannot pass on your debts to your family, and those who are owed money will not be able to recover anything from your estate. Of course if you have given assets away knowing you owe money or in the hope of evading your creditors in some way, then the rules of insolvency still apply and your creditors can try to take action against your estate to undo the gifts and recover monies owed. If, however, you die penniless but leave behind a string of debts then your debts will die with you.
The position is more complex if you have assets, but not enough to pay everyone fully. Should this happen then your debts would not die with you as there are funds to pay some of your creditors. In such a circumstance, it is vital to take proper legal advice from a specialist probate solicitor. The reason is that there are rules governing who gets paid how much, and in what order. If debts are paid incorrectly, then you could can find yourself personally liable to pay anyone who has lost out because of an error.
Similarly if instead of paying off debts, money is paid to those who benefit under the will instead, then there is likely to be a legal responsibility on the person making the payment, to make good their mistake out of their own funds.
You should remember, however, that your estate should only meet the debts from the money it holds. Once the estate money has run out, and provided everyone has been paid correctly and in the right order, then any other debts outstanding will die with you. It is not down to those that could have benefitted under your Will or your family to pay the remaining debts. If they have received nothing, do not owe the money themselves as a joint debtor or guarantor and there is no money left then they do not have to make payments for your estate.
Are you are looking for probate solicitors? Talk to Hull Solicitors Myer Wolff. Ashley Easterbrook is a partner in the firm's private client department.
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