assumptions are that the single parent debts far exceeded his assets. Also the child is a legal adult and would be named in a will of the deceased single parent. If the child doesn't assume the debt and have to pay it off, then what happens to the debts. thank you!
2007-07-12 10:41:12 · 5 answers · asked by scottmc3 1 in Business & Finance ➔ Personal Finance
unless the child is named as co-signer or otherwise listed on debt, no. However you are obligated to liquidate what assets there are and pay off debts that exist. To each debtor, regardless of the payment (on non-payment) you must send a copy of the death certificate. Many states require a public announcement be posted in a public place, such as the courthouse, or in the local paper stating that so and so has died and that all debt, public and private, will be settled with the liquidation of the estate.
If the parent did not have a will it is quite probable that the state will probate the estate including all real property, bank accounts, stock, jewelry, etc, (anything of value).
If your name is NOT on any of the debt, nor on any of the assets then you do not assume the debt. If you are listed on an asset and there is outstanding debt on the property (like a house) you may be forced to sell it to pay off any and all remaining debt.
If there is a Will and the assets are worth more than $600,000 then the will may have to be probated by the state and estate taxes and inheritence tax MAY apply.
If there is a Will AND a Trust was established, then the property transfers without interference, but the outstanding debts must still be resolved using the parents assets.
so to answer YOUR question, no, you are not responsible for your parents debt unless you are a cosigner, or share the account.
2007-07-12 11:01:37 · answer #1 · answered by Sarge1572 5 · 1⤊ 1⤋
Debt is NOT inherited. Any assets owned by the parent at the time of death must be used to pay outstanding debts before anything can be inherited. Any debt above the value of the assets is 'paid' with a copy of the death certificate. There are rules about who gets paid first. You should probably consult an attorney about that. I believe the estate pays the attorney, and gets priority for payment. They should be able to confirm or deny that for free.
Sarge1572 is not entirely accurate about when probate is required. Probate is the legal term for settling ANY estate. Smaller estates may not require FORMAL probate though the courts, but probate is ALWAYS required.
2007-07-12 12:07:42 · answer #2 · answered by STEVEN F 7 · 0⤊ 1⤋
The parents estate (assets) will be liquidated to pay debts. If the debt exceeds assets, the kids are not legaly liable in most US states. The creditors may ask you to pay, but you aren't required to by law. It will be a loss for creditors.
2007-07-12 10:51:52 · answer #3 · answered by morris 5 · 0⤊ 0⤋
the only way you will inherit the debt is thru inheriting money from the determine. The debt could ought to be paid off previously the relax money ought to be chop up between siblings. If the debt is extra advantageous than the money inherited then it gets written off.
2016-10-01 11:44:16 · answer #4 · answered by Anonymous · 0⤊ 0⤋
This should answer your question...
http://www.debtsmart.com/pages/article_inherited_debts_01102499.html
2007-07-12 10:49:19 · answer #5 · answered by Anonymous · 0⤊ 0⤋