Not enough money in estate to pay debts

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whattodonext

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what happens when not enough money in estate of deceased to pay all bills.
What is the order bills are to be paid from estate is it

1. funeral costs 5k
2. items named in will handed out to beneficiaries.
3. bank loans, overdrafts, visa cards 15k
4. then is it first come first served of outstanding bills (total including 10k below = 19k)
Total owed/debts/funerial exp= 39k

The deceased owns no property, just car worth 3k, money 20k and a few valuable sentimental items which were stated in will to go to family members worth about 12k
total estate = 35k

She had a debt of 10k which court proceedings had started before she died, but she didnt go to court due to illness. Can the proceedings be taken against the estate which means items would be sold instead of going to family.
we haven't done probate yet
what would be best thing to do
 
I don't think you can distribute items to beneficiaries (even items named in will) until creditors have been paid
 
What happens to bank accounts in joint names with family members. Does those debts come out of the estate or does the debt in full pass to the living person. Can the debt be used to reduce the estate value and hence tax etc.
 
whattodonext said:
What happens to bank accounts in joint names with family members. Does those debts come out of the estate or does the debt in full pass to the living person. Can the debt be used to reduce the estate value and hence tax etc.
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Can you explain what you mean.

Are you talking about a joint bank account which is in overdraft ?
In general, the contents of a joint bank account automaticaly pass to the second party on death of one person, and do notform part of the estate, but I do not know the details of the situation with an overdraft.

Also, each debt may be different. Some may have life assurance attached and therefore will be cleared.

This is obviously a complication situation which needs better professional advice than you are going to get on a website.

Sorry for your situation and I wish you well.
 
Simple query;
if overdraft is 10k and is in joint names can it be added in whole to amount be added to other debts so it will be subtracted from asset value in estate. Resulting in a reduction in the net value of estate so taxation calculation will be reduced.
Eg 15k assets less 10k overdraft leaves 5k net value so tax is reduced
 
Nope. The overdraft would pass to the surviving account holder and thus would not form part of the estate.
 
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