Our son is the legal heir to his fathers estate. Are the assets his to keep. There are debts on the assets.
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Our son is the legal heir to his fathers estate. Are the assets his to keep. There are debts on the assets.
Property is in Iowa. Home is in a single person LLC. Property management. Truck, Home, credit cards are part of debt. Aunt in another state is executor but does not want to help. Uncle is attorney in another state but does not want to help.
Asked on October 16, 2017 under Estate Planning, Wisconsin
Answers:
SJZ, Member, New York Bar / FreeAdvice Contributing Attorney
Answered 6 years ago | Contributor
Secured debts (like a mortgage on real estate; the typical car loan which allows for repossession if the loan is not paid; etc.) MUST be paid off (or arrangements made with the bank--which arrangements would be voluntary for it--to pay over time, refinance, etc.). If they are not, the bank/lender can take the property which secures the loan (foreclose, repossess, etc.).
Unsecured debt (like credit card debt) does not directly impair the property, BUT if the creditor chooses to assert a claim against the "estate" (the assets, etc. left behind when your son's father passed away), the estate would have to pay it to the best of its ability. If the estate does not pay off the debts, the creditor could sue and in the process of suing likely put a lien on the property. The estate may have to sell or liquidate the property/assets to pay any claims by creditors.
So the short answer is, sizable debts may well keep your son from getting the assets. Small debts may have to be paid to get the assets free and clear.
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