How Debts Are Handled in New York Probate

When a loved one passes away, their estate often goes through probate—a legal process that involves collecting assets, paying debts, and distributing what remains to heirs. In New York, understanding how debts are handled in probate is essential to protecting both the estate and its beneficiaries. At Sayegh & Sayegh, we can provide legal assistance to the Yonkers public in navigating this process.

The Role of the Executor

The executor, appointed by the court or named in the will, is responsible for managing the estate. One of their key duties is to identify, validate, and settle outstanding debts before distributing assets. These debts may include medical bills, credit cards, mortgages, or personal loans.

Priority of Payments

New York law requires that debts and expenses be paid in a specific order. Typically, administrative costs such as court fees and executor compensation are paid first, followed by funeral expenses, taxes, and secured debts. Unsecured debts, like credit cards, are generally paid last. If the estate does not have enough assets, some debts may remain unpaid.

Protecting Beneficiaries

Beneficiaries are not personally responsible for the deceased’s debts. Creditors can only collect from estate assets, not from heirs’ personal funds. However, if property such as a family home is subject to a mortgage, the lender may still have a claim against it unless the loan is settled.

Insolvent Estates

When debts exceed the value of the estate, it is considered insolvent. In these cases, New York probate law dictates which creditors get paid first. Heirs may receive nothing if the estate does not have enough assets after debts are settled.

Why Legal Guidance Matters

Navigating debts in probate can be overwhelming, particularly when creditors are persistent. A probate attorney can help ensure that debts are paid correctly, protect beneficiaries’ rights, and prevent costly mistakes.

At Sayegh & Sayegh, we can provide legal assistance to the Yonkers public with probate and estate administration, ensuring that debts are handled properly and efficiently.