When a person is appointed as a personal representative of an estate, one of the most critical issues they want to discuss is what to do with the outstanding debts or creditors of the decedent.
However, understanding your role as a personal representative in a probate administration case can be challenging. Today, we’re here to help you understand the probate administration process in more detail.
To schedule a consultation with our team and work with our office on your probate administration case, contact us online or via phone at (239) 970-6844.
What Are the Statute of Limitations for Creditors in Estate Administration Cases?
The general statute of limitations for creditors of a decedent is two (2) years. Therefore, if the creditor has not moved to enforce their claim against the estate within two years, they are forever barred. However, this does not include secured claims, creditor claims secured to an asset such as mortgages, car loans, or other such secured liens. Those debts are not subject to any limitations addressed here.
Therefore, if an estate has a home or car which has a loan, they must move to ascertain the balance due and address those debts first as they may continue to grow throughout the probate administration.
What Does the Personal Representative Do?
In formal administration, the personal representative is required to take action in several different ways. First, the personal representative must make a prompt and diligent search to determine the readily ascertainable creditors and must serve them with a copy of the notice to creditors—Fla. Sat. §733.2121(3)(a). Therefore, if a creditor is known after a reasonable search of the decedent's mail, paperwork, or home location, they must be individually noticed.
For those creditors who are unknown or not readily ascertainable, the personal representative in formal administration is required to publish a notice to creditors in a newspaper in the county where the probate has been filed. Fla. Stat. §733.2121(1). Upon publication, creditors have ninety (90) days to file a statement of claim in the probate case to become a creditor of the estate. Any creditors who fail to file within the aforementioned time period are forever barred.
Addressing creditor issues in a probate estate is critical. The personal representative must preserve as much of the estate as possible. The treatment of creditors can directly impact how much of those assets are left for distribution.
Contact our office and discuss your case with an experienced attorney today.