|Posted by Ron Koehler on August 27, 2012 at 8:50 PM|
In these difficult economic times, many people have run up a lot of credit card debt, and some have repeatedly re-financed their home cashing out more equity each time, leaving themselves with a house worth less than what is owed on the mortgage. Ohio law provides a mechanism for resolving the estate of a person who owes more than their probate assets are worth. It is called an insolvent estate, and the law allows certain debts to have a higher priority than others. For instance, unsecured credit card debts are the lowest priority. The expense involved in administering the estate and a certain portion of the funeral bill and burial costs have a higher priority. The law also provides something called a family allowance, which means that the surviving spouse and children under age 18 are entitled to up to $40,000 from the estate before any estate assets have to be used to pay lower priority creditors. If a loved one dies with substantial debt, do not make any payments on the debts, especially credit card debt, until the matter has been reviewed by an experienced probate attorney. I have many years experience handling insolvent estates, and can help guide you through the estate administration.