Dealing With Debts and Liabilities in the Probate Process

When someone passes away, dealing with their estate, including any debts or financial obligations, can feel overwhelming. From locating a Will to notifying creditors and distributing assets, the legal and administrative responsibilities placed on the executor can be complex and emotionally draining. Crucially, all debts must be settled before any inheritance is passed on, and failing to follow the correct legal procedures can lead to serious consequences.

At Burt Brill & Cardens, we regularly support clients through probate and estate administration. If you’re managing an estate or have been named as an executor, we strongly recommend speaking with our expert team before taking action.

Where to Start When Someone Passes Away

One of the priorities after someone dies is to establish whether a valid Will exists. This determines who has the legal authority to act and how the estate should be administered. If there is no Will, the rules of intestacy apply, and Letters of Administration must be obtained before any steps can be taken.

You must also register the death — usually within five days in England and Wales — and begin making funeral arrangements. Many people understandably want to proceed quickly during this time, but it’s essential to ensure all necessary steps are followed in the correct order. Our probate solicitors can guide you through these early stages with clarity and care.

Managing probate is also emotionally demanding, especially while you’re still grieving. Even simple estates can require dozens of administrative tasks — from locating paperwork to fielding enquiries from family members. Having a solicitor on your side can relieve a significant burden and help you feel confident that everything is being done correctly.

Identifying the Deceased’s Debts and Liabilities

If you have been made an executor of a Will, you have many important tasks. An important part of estate administration is identifying the debts the deceased may have left behind. 

Executors must ensure all outstanding debts are identified and paid from the estate’s assets before any distribution to beneficiaries. Failing to do so correctly can lead to personal liability.

Many modern estates also include digital assets, such as online bank accounts, investment platforms, or cryptocurrency holdings. Others may involve overseas property or pensions. These elements often introduce legal complexities that require specialist support.

Rather than attempting to track down and settle debts yourself, our team can assist in contacting creditors, reviewing financial documentation, and ensuring nothing is overlooked.

Related Reading: Wills and Probate for Ex-Pats

How Debts Are Prioritised in Probate

If someone’s death is sudden, you may find you have more to pay back than expected. Debts must be paid in a specific legal order of priority before distributing any inheritance:

• Secured debts (e.g., mortgages) must be settled first, as they are tied to assets.
• Funeral and estate administration expenses come next.
• Unpaid taxes to HMRC must be addressed, as tax debts take priority. This will require the help of an accountant.
• Unsecured debts, such as loans, credit cards and utility bills, are paid after tax obligations.
• Personal debts to family or friends are settled last if funds remain.
  

If the estate is insolvent — meaning there isn’t enough money to pay all debts — executors must follow strict rules about how funds are distributed. Beneficiaries will not inherit any unpaid debt, but they also may not receive an inheritance.

If you’re unsure whether the estate can cover its obligations, do not begin paying off any debts or distributing money to beneficiaries until you’ve spoken to a solicitor. Acting too early or without legal advice can expose you to serious personal risk.

How to Avoid Personal Liability as an Executor

Executors are legally responsible for ensuring that debts are handled correctly. If debts are overlooked or the estate is mismanaged, they could be held personally liable.

To protect yourself, it’s often necessary to:

• Advertise for creditors in The Gazette and local newspapers
  
• Delay any distributions to beneficiaries until all debts are accounted for
  
• Keep accurate, detailed records of all financial activity
  
• Consider formal procedures such as Insolvency Administration Orders, if appropriate.

Disputes can also arise, potentially from creditors challenging the estate’s value or from family members disputing the Will. In these cases, having a solicitor involved from the start can protect your position and help you manage conflict constructively.

While some people consider using DIY probate kits or low-cost online services, these rarely provide the legal protection or tailored advice needed for complex or debt-laden estates. When debts are involved, working with a solicitor offers the reassurance that everything is being done correctly and you’re protected throughout.

What If There’s Not Enough to Pay All Creditors?

If an estate doesn’t have enough money to repay all creditors in full, the debts must usually be settled on a proportional basis. For example, if only half of the money owed to unsecured creditors can be paid, each creditor will receive 50% of what they are due.

Trying to manage this process yourself can be incredibly stressful, particularly when family members are waiting for their inheritance. It’s also where low-cost or DIY probate kits often fall short, as they don’t provide the bespoke advice needed for difficult situations like insolvency or disputes.

A solicitor can guide you through this process step-by-step, ensuring all actions are legally compliant and fully documented.

Contested Debts and Probate Disputes

Occasionally, creditors may dispute the amount they are owed, or family members may contest the distribution of assets. When disagreements arise, having a legal team involved from the start can help prevent escalation and protect your role as executor.

Peace of Mind Through Professional Guidance

Administering an estate can take months, even longer, if complications arise. Executors often don’t realise the time commitment involved — chasing paperwork, dealing with banks, responding to creditors and fielding questions from beneficiaries. In many cases, it can feel like a full-time job taken on during a period of grief.

At Burt Brill & Cardens, we’ve been guiding families through probate for over 125 years. We combine technical legal knowledge with a warm, understanding approach that helps ease the burden during a difficult time.

Rather than navigating probate alone, let our experts ensure everything is done correctly, giving you peace of mind and legal protection.

If you’ve been named as an executor or are handling the affairs of someone who has died, contact our friendly and supportive team today on 01273 604 123, email us at enquire@bbc-law.co.uk, or make an enquiry. Let us take care of the legal details so you can focus on what truly matters.