The debts do not die with the person, but they also do not follow the family. They attach to the estate, and the estate pays them in a priority order before anyone inherits anything.
The useful part is that probate gives you a way to cut off claims permanently, which is something no informal handling of an estate can do.
The personal representative publishes notice and sends direct notice to every creditor known or reasonably ascertainable. Those creditors then have a limited statutory window to file a claim with the court. Miss the window and the claim is generally barred. That bar is the whole point of the exercise.
Reasonably ascertainable does more work than people expect. If a hospital bill is sitting in the decedent's mail, that creditor is known to you. Choosing not to open the envelope is not a strategy.
Administration expenses come first, then certain priority categories, then general unsecured creditors, then beneficiaries. Secured debt is its own animal. A mortgage rides with the house whether or not anybody files a claim, because the lender's remedy is the property itself.
Distribute early and you own the debt
A representative who hands out money before the claim period closes can be personally responsible for what the estate can no longer pay. Not the estate. You. This is the most reliable way a well-meaning executor turns an inheritance into a lawsuit against themselves.
Claims worth fighting
A claim can be rejected, in whole or in part, and the creditor then has a limited time to sue on it. Rejection is appropriate for debts that are not owed, are inflated, or are past their own statute of limitations. Old credit card debt bought by a collection agency is a category worth reading carefully before you pay it.
Medi-Cal recovery is a distinct area with its own notice requirements and its own exceptions, and it comes up regularly in Los Angeles estates where the decedent received long-term care. Do not assume, in either direction, without checking.
“I once had an executor pay a $9,000 hospital bill out of his own checking account in week two because he did not want his mother to look like a deadbeat. Nobody was going to look like anything. That money never came back to him because he never got court approval for the reimbursement, and I could not fix it after the fact.”
Delia Vasquez-HartDebts the family is not on the hook for
- Unsecured debt of the decedent, unless a family member co-signed or was a joint account holder
- Balances a collector claims a child owes as next of kin, which is generally not a thing in California
- Debts of the estate beyond the value of the estate, since an insolvent estate simply pays what it can in priority order
Questions we get asked
Do I have to notify a creditor I think is wrong?
Yes, notice and payment are separate decisions. Give the notice, then reject the claim if it deserves rejection. Skipping notice to avoid a claim keeps the claim alive.
What if the estate cannot pay everything?
It pays in statutory priority until it runs out. Beneficiaries receive nothing in that case, and the representative should not be paying anyone out of order along the way.
Can creditors reach assets that passed outside probate?
Sometimes, particularly trust assets, which are not immune from the settlor's debts. A trust avoids the probate case, not the obligation to pay legitimate debts.
How long is the claim period?
It is a limited statutory window that runs from the later of the general notice date or direct notice to that creditor. Calendar it precisely, because the whole benefit depends on the dates.
Collect the decedent's mail for thirty days without discarding anything, then bring the pile in. That stack of envelopes is how we build the creditor notice list correctly the first time.