What is Probate?
Probate is the legal process used to administer the estate of the deceased. The probate process involves:
- An accounting of the deceased's assets.
- Distribution to those collecting on deceased receivables, heirs, beneficiaries and anyone else entitled to payment from the estate.
In general, an estate is responsible for all debts, bills and expenses. These expenses must be paid before any remaining assets in an estate can be distributed to any person under a will. Having a will does not excuse an estate from going through probate.
Why Should I Utilize Probate?
Both federal and state laws recognize that creditors recovering on deceased receivables have a right to payment through probate and that filed probate claims must be paid out to those individuals before any inheritance is distributed to beneficiaries or heirs.
Utilizing the probate process by filing a claim ensures fair payment to those recovering on deceased debt and provides an approach that achieves an effective balance between fiscal responsibility and organizational reputation protection.
Probated estate payout occurs based on the Probate Liquidation Order of Priority (Fig 1).
Probate Liquidation Order of Priority"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." - Uniform Probate Code
How can I Utilize Probate?
Utilizing probate is the most efficient way to collect on your deceased accounts receivable, but doing so can bring challenges. A new technology eliminates these challenges and revolutionizes the way you collect on deceased debt by automating the probate estate location and claim filing process. Enhance your in-house accounts receivable collections process.