Must I repay a loan of $1500 to my dad’s estate if there is no signed loan agreement?

UPDATED: Nov 5, 2010

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Must I repay a loan of $1500 to my dad’s estate if there is no signed loan agreement?

At one point, I told my 3 sisters that I would pay them each $500 for the $1500 that I had borrowed from our late father. I have since changed my mind and have nothing to do with 1 of my sisters; the other 2 don’t care about this issue. Am I legally obligated to repay my dad’s estate for an informal loan?

Asked on November 5, 2010 under Bankruptcy Law, Minnesota


M.T.G., Member, New York Bar / FreeAdvice Contributing Attorney

Answered 12 years ago | Contributor

I am sorry for your loss.  Unless the money was a gift then you will always have the obligation to pay back a loan.  Whether or not you do is dependent upon you and your family and how they want to deal with things. It is a verbal loan (contract) as you have stated.  So if a person - the executoror personal representative of the estate has the right to do this - wanted to push the issue they would have to prove the elements of a contract in order to be able to collect.  You have already admitted to the loan.  Here is my concern.  The executor - or personal representative - has an obligation under the law to collect all debts owed to the estate.  You have not stated who that is here but if it is one of your sisters then she has the obligation to do so, whether or not you think you have the obligation to pay.  

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