Sometimes a person dies leaving more debt than assets. Ohio law provides a way to resolve the estate of a person who has died in this predicament. 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 is a higher priority.
The law also recognizes a family allowance, which means that the surviving spouse and children under age 18 are can receive 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 of experience handling insolvent estates and can help guide you through the estate administration process.
