Burlington elder law lawyers help people of all ages to take steps to try to become as financially secure as possible. We work with you throughout your life to establish plans to save money, use tax-advantaged retirement accounts to help build a nest egg, and use legal tools effectively to protect your assets. Our firm can also provide assistance with making a legacy plan and can help family members when someone has passed away with the process of transferring assets onto the next generation.
One issue that many people worry about, both during their lifetimes and after a loved one has passed away, relates to debt. In particular, it is common to be concerned about what happens to debts after someone has died. The Law Offices of James A. Miller, P.C. will provide insight into protecting assets from creditors during the course of your lifetime so debts don’t impact your ability to leave a legacy, and will help those whose loved ones have died with debts to understand the implications of the debt on an inheritance.
To find out more about how our firm can help you with all legal issues related to estate planning, incapacity planning and the transfer of assets during the probate process, give us a call today.
What Happens When Someone Dies with Debt?
Many people die with debt in the United States. In fact, as Credit.com explained, Americans now die owing an average of $61,554 dollars. This includes mortgage debt that is outstanding upon the death of the property owner. If mortgage debt is excluded, people in the United States die owing an average of $12,875.
If a person dies with debt, the implications of that debt are going to vary depending upon many factors including the kind of debt that the deceased person had, as well as the type of property that the deceased person owned and the way in which the assets were transferred.
Generally, when someone passes away, creditors must be notified of the death. This job falls to the executor in situations where the deceased had an estate that must go through the probate process. Creditors have the opportunity to make claims on the estate in order to try to recover the unpaid balance of the debt that is due. As long as a creditor can demonstrate that money is owed, the estate may have to pay off the balance that is due out of estate assets. This could end up reducing the total value of an inheritance since money is paid out of the estate to the creditors.
There are circumstances in which a person is able to transfer assets in a manner that protects those assets from creditors. However, it is important to act well in advance of the time that you pass away if your goal is to protect assets from creditors during your lifetime and after the course of your death.
The Law Offices of James A. Miller, P.C. can help you to determine if there is a way to protect your property when you pass away. However, even if you are able to protect some of your assets, there may still be debts that must be paid. For example, if your heirs or beneficiaries are going to keep a family home with an outstanding mortgage balance, there’s typically no way to avoid paying that loan and still keep the house.
If there are no assets from which the debt could be paid, then typically creditors will not be able to collect upon the debt. Family members should not expect to pay debts out of their own pocket for someone who has passed away unless they co-signed for the loans.
Getting Help from Burlington Elder Law Lawyers
Burlington elder law lawyers at The Law Offices of James A. Miller, P.C. can provide you with help throughout your career in trying to build and protect wealth so you do not need to worry about debt preventing you from leaving a legacy. We can also assist you in understanding the impact of debt on an inheritance, and can help those who are trying to protect an inheritance during the probate process or the trust administration process.
To find out more about the services that we can offer, give us a call at 866-370-3888 or contact us online today. You can also join us for a free seminar. If you reach out to our legal team, we can work with you to understand the risks to your wealth and can help you make effective use of legal tools to protect the assets that you have inherited or that you have worked hard to acquire during your lifetime.
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