Debt has a way of accruing quickly, especially when someone has limited income. Older adults are at particularly high risk for acquiring more debt than they have any means of repaying.
Once someone retires, they may have a fixed income based on a pension or Social Security benefits. If their nursing home expenses or medical costs exceed that income, they might have to use credits to buy their groceries or pay their utility bills. They could also potentially accrue a substantial amount of debt to the facility where they live or to the hospital that treats them in their last days of life.
As someone who should inherit assets from an estate, it’s important to understand what the debt of the deceased party might mean for your right to inheritance.
Ohio creditors can bring a claim against the estate
Ohio state law is clear that all creditors owed money by a deceased individual have grounds to bring a claim against that individual’s estate. Whether the debt is due to an account or from a judgment related to an injury caused by the deceased person, the right of a creditor to repayment generally supersedes the rights of family members and beneficiaries to an inheritance.
The personal representative for the estate will have to repay all of the creditors who make a claim against the estate before they distribute any property to the beneficiaries listed in the estate plan. If they distribute property without repaying the debts, the creditors who don’t receive reimbursement may be able to bring a legal claim against the executor for the amount that went unpaid.
Timely and accurate estate administration helps protect someone’s legacy
An executor should take timely steps to repay debts and turn off accounts in the name of a deceased individual. Delays in performing these important tasks could ultimately result in higher amounts of debt that diminish what beneficiaries receive.
Making sure that an executor acts in a timely manner is of the utmost importance for beneficiaries worried about losing their inheritance due to death or the mismanagement of estate assets. Knowing that you can bring a challenge against an executor who mismanages estate assets or fails to communicate with creditors in a timely manner can help you protect your inheritance.