I want to know if creditors are barred from being paid from an estate?

I am executor of my mothers estate. My attorney sent out certified letters to creditors to notify them of her death and that is has been published in the paper. The letter to creditors say's that they had 4 months to make proper claims or be barred.
My Mom had a business loan with her bank for $40K. They got a letter that they had 4 months to make a claim. Nothing was received by my attorney, or the estate from the bank as far as a claim but they keep sending regular statements just like they always have for their monthly bill of $1,000.

My attorney who has never done this before by the way says as long as they send statements they are not barred. Isn't this wrong? Don't they have to respond with a real claim against the estate? I can't see how a regular monthly statement is their claim. It is not even addressed to the estate. I don't want to pay $40K out of the estate if the attorney is wrong. I appreciate your answers. Thank you!

I am sorry for your loss. Creditors can file liens on estates. If your mother owed money to them, they just have to file a petition with you or with the probate court and the judge will decide how much they should get, if not their whole debt, depending on who else is owed, how much money the estate has, etc. That is why a public notice is required to be published for three to four months on an estate, so creditors and anyone who feels they have a right to contest the estate knows about it and can do so.

Thank you. Report It

sure, just pass the cost onto the rest of us why dont you?

Creditors are NOT barred from being paid from the estate...all creditors must be paid from your mother's estate.

Consult a probate attorney. They are experts in this field. Also check the original loan agreement. A lot of them have an insurance in the event of the death of borrower. Then the loan would be paid off by the insurance company. Good Luck.

Usually probate can tie up an estate for about a year. But since you know your mother OWED the money, why don't you see to it that they get what is theirs and stop trying to be a theif!!

YUK I feel the the slime just reading this.

First off they have a valid claim against the estate and you trying to NOT pay them is stealing no matter how you try to spin it.

Secondly the regular statements ARE in fact "claims" of a debt that is owed. Pretending that they have to give you some special form to "claim" the debt is owed is specious at best and would be viewed as such by a court. The intent of making notices/sending letters is to insure no one later pretends you tried to hide the death.

Thirdly I wonder if a debt as large as $40,000 wasn't collateralized somehow (e.g. a mortgage against property your mother owned). If it was then they likely still have a legal interest in that property irrespective of any other probate proceedings