Dying with outstanding debts in Florida may create a complicated situation for the deceased’s loved ones. Under Florida Law, the personal representative must settle any outstanding debts using resources from the estate.
What happens to household bills during probate in Florida? Read on the find out.
Household Bills vs. Probate in Florida – The Essentials
Household bills are those bills generally received at home through the US Postal Service, such as council taxes, gas bills, electricity bills, water bills, phone bills, and other similar expenses. In Florida, the deceased’s estate must be distributed according to the statutory rules in state law.
If the estate is subject to probate, the court must designate a personal representative (or “executor”) to administer the deceased’s affairs, wrap up the estate and distribute the remaining assets to the heirs.
One of the duties of the personal representative is to pay any unpaid bills, file tax returns, and settle any unsolved issues before the process of distribution.
Who is Responsible for Paying Household Bills During Probate in Florida?
Household and utility bills must be paid exclusively by the owner of the property. When the owner of the property dies, the estate is responsible for paying the bills.
If the deceased’s property is a homestead, the ownership transfers at the moment of death. In such cases, the new owner must pay the household bills to avoid losing access to basic household services.
Depending on the case, the deceased’s family may opt for paying unpaid bills and later get a reimbursement from the estate. Risking damage to the property due to a shut-off in utilities is not a good strategy.
What Happens to Household Bills During Probate in Florida? – Taking a Closer Look
Creditors often try to collect from a deceased person’s relatives when they discover the debtor has passed away. It is fundamental for a decedent’s family or personal representative to work with an expert attorney before paying any amount owed to creditors.
Under Florida law, only a few exceptions permit that a third party is personally liable for a deceased’s debt:
- If the person was a co-signer on a loan borrowed with the decedent
- If the person is a joint bank account holder or joint credit card holder with the decedent
- If the decedent’s surviving spouse is subject to spousal debt
- If the asset subject to creditors’ claims was jointly owned by the surviving spouse and the decedent
Depending on the circumstances, household debts must be paid to retain the property. For example, if a Florida resident dies with an outstanding mortgage on a property, the mortgage must be paid to avoid foreclosure.
If there is sufficient money or assets in the decedent’s estate to be liquidated and used to pay outstanding debts, the personal representative must pay everything following the statutory order of preference (Fla. Stat. §733.707).
Florida Statutes §733.707 (2) specifies that “after paying any preceding class, if the estate is insufficient to pay all of the next succeeding class, the creditors of the latter class shall be paid ratably in proportion to their respective claims.”
If the decedent’s estate has no sufficient money or assets to fulfill all the pending obligations, the personal representative must handle the existing debts in order of priority. In certain cases, some bills will not be paid.