How To Handle Creditor Claims On an Estate
April 20, 2021
Being the trustee or executor of an estate is something that has to be done, even during the difficult time of losing a loved one. When there are creditor claims involved, you may want the trusted guidance of an experienced attorney who can help you navigate those claims.
For years, Bearman Law has been working with individuals and families faced with creditor claims when acting as an executor or trustee of an estate. Estate planning attorney David Bearman can help you through the process of estate administration and handling any creditor claims on the estate. Bearman Law has offices in both Salem, Oregon, and Lake Oswego, Oregon, and is also proud to help clients handle their cases remotely across the entire state of Oregon.
The Role of the Trustee/Executor
to Search & Notify Claimants
According to Oregon law, if you are the personal representative of the estate, you must make a diligent search for claimants. This is done by investigating the financial records and affairs of the deceased and obtaining the identity and address of any person who has a claim against the estate.
This process should be completed within three months of appointment as the representative. If it seems like you may need more time, you can request it from the court. Once this period is over, you have 30 days to deliver notice to any creditors of any important information about the claim, such as the court in which estate proceedings are occurring, who the personal representative is and their contact information, and the name of the deceased.
How are Claims Paid to Creditors?
The payment of claims is made after the day in which all known claims are barred. The spouse and the children of the deceased are always provided for first. This order of payment is often a comforting fact for families, as an Estate Planning Awareness Survey conducted by ORC International reported that more than two-thirds of Americans — roughly 67% — say they are often concerned about their families' long-term financial well-being.
When it comes to expenses and claims on an estate, there is an order in which payment is made. This comes into play especially if the assets left behind on the estate will not be able to cover all of the expenses. The order is as follows:
Support of spouse and children
Expenses of administration of the estate
Expenses of the funeral
Debts and taxes under federal law
Taxes under state law
Debts owed to employees of the decedent for labor within 90 days before their passing
Claims under the Department of Veterans Affairs
Claims under the Department of Human Services or the Oregon Health Authority
If the estate does cover all payments and there are assets remaining, any other claims presented and allowed will be paid in the order that they are received and that assets remain.
When Are Claims Disallowed?
Claims against an estate are generally allowed the way they are presented. The exception to this rule is if the personal representative delivers a notice of disallowance of claims within 60 days of its original presentation. The notice must have a reason for disallowance, such as the fact that the estate is unable to cover all expenses and claims.
How Bearman Law Can Help
At the end of the day, Bearman Law is committed to putting your family’s well-being first. When it comes to creditors making claims on the estate in which you are the trustee or executor, it is important to work with a knowledgeable Oregon estate planning attorney who can help you fully understand the unique details of your situation. Attorney David Bearman can provide reliable legal guidance and counsel throughout each step of the process of creditor payments. Bearman Law is prepared to work with each client to help educate them on the proceedings so that they can make informed decisions at every turn.
For years, Bearman Law has been working to help guide individuals and families through the often complicated process of acting as an executor or trustee of an estate. With two office locations in Salem and Lake Oswego, Oregon, Bearman Law is proud to provide experienced legal counsel and guidance to clients across the entire state. Call or reach out today to schedule a free case consultation.