My father died and his medical and credit card bills exceed his assets. I had to pay the funeral home. How do I get reimbursed and will I be liable to his debts?
It is not uncommon, with today’s high medical costs, for the debts to exceed remaining assets. The only way to resolve this dilemma so you get paid and don’t incur and liability is to pay the debts based on an order to not use or disperse funds. This is one of the rare instances where you want to go through probate, and with a deficit estate it is more complicated than usual. In this case you are going to want to hire an estate planning attorney.
The good news is that, if done properly, you will not be liable for your father’s debts and can get repaid for the funeral. In addition, the cost of hiring an attorney will not be borne by you, but rather by the creditors. This is because there is a hierarchy in the order of paying expenses and debts. The first to get paid are the expenses of administration such as attorney and accountant fees. Without this supervision you wouldn’t be able to get anyone to help you. The next to get paid is the funeral home. Following the funeral expenses come the creditors, and finally the heirs. In a case such as this the family will get nothing and the creditors will get a fraction of what they are owed. It is up to the judge to approve any payments and the creditors are bound by the judge’s decision, so you will be off the hook.