A fundamental step in the Colorado probate process is handling all outstanding debt claims against an estate. This has to occur before any of the estate assets can be distributed to the beneficiaries, and the process can be more involved than people may realize, especially for larger estates and/or estates with more outstanding debts.
To aid personal representatives in this effort, below are some helpful tips for dealing with creditors during Colorado probate.
Tips for Personal Representatives: How to Handle Creditors in Probate
- These tips for dealing with creditors in CO probate can help personal representatives limit their liability, experienced Pueblo probate attorneys explain. Here’s how.Be aware of the deadlines/time frames – There are specific times frames within which personal representatives must publish notice to an estate’s creditors regarding the death. Additionally, this Notice to Creditors must be published at least one time per week (in a local publication in the county in which the decedent resided) for a minimum of three consecutive weeks (or four weeks from the first date of publication). Following this, the creditor claim period will be opened for 6 months (or up to one year if the publication rules were not appropriately followed).
- Don’t assume every debt claim against an estate is valid – In other words, double check every debt claim against the estate, as publishing the Notice to Creditors can lead to all sorts of people or companies coming out of the woodworks to try to get money from an estate, and not every claim may be legitimate.
- Wait until the claim period has expired before paying any debt – The reason that this is important is that not all debts are equal and some will need to be paid first. To avoid paying low priority debts at the expense of higher priority ones (and, in doing so, potentially become liable for repayment), just wait to pay any claim until all claims have been submitted and verified.
- Keep detailed records of every debt paid and/or denied – This is incredibly important, as personal representatives are responsible for keeping detailed records of estates’ financial transactions. For every debt claim, be sure to record whether or when the claim was paid, as well as how much was paid. Failing to account for any payment could, again, make personal representatives liable (as it could lead to breach of fiduciary duty lawsuits).
- Retain a lawyer for guidance – This is the single most important tip to follow if you have never probated an estate before and/or if you want to be sure to avoid any mistake that could result in personal liability. Ultimately, dealing with creditors in probate can be complicated, and an experienced attorney can help you appropriately manage and get through this process – as well as the entire Colorado probate process – as favorably and efficiently as possible.
Contact the Trinidad and Pueblo Probate Attorneys at Gradisar, Trechter, Ripperger & Roth
For experienced help getting through probate, contact the Trinidad and Pueblo probate attorneys at Gradisar, Trechter, Ripperger & Roth.
To learn more about our superior legal services and how we can assist you, contact us by calling (719) 556- 8844 or by emailing us using the contact form on this page.
From our offices based in Pueblo, we represent clients in Trinidad, La Jara, Lamar, Walsenburg, Alamosa and throughout the state of Colorado.