How Long Do Creditors Have to Collect Debts From an Estate in Florida?

how long do creditors have to collect a debt from an estate

When someone passes away, their outstanding debts and liabilities don’t simply disappear. Creditors have a legal right to seek payment from the deceased person’s estate, which includes their assets and property. Creditors make claims against the estate to the court overseeing the probate.

In Florida, creditors typically have ninety days from the date the notice to creditors is first published to make a claim against the deceased person’s estate for any outstanding debts.

If a creditor misses this window and doesn’t properly pursue an extension, they can be permanently barred from collecting that debt from the estate.

Notifying Creditors After a Death

Before creditors can file claims against the estate, they need to be notified of the death. The personal representative appointed by the court has the responsibility of publishing a “notice to creditors” in a local newspaper. This notice informs any potential creditors that they have a limited time to make claims against the estate.

The personal representative must notify creditors of the death by:

  • Publishing a “notice to creditors” in a local newspaper once a week for 2 consecutive weeks. This notice must include the name of the decedent, the file number of the estate, the designation and address of the court in which the proceedings are pending, the name and address of the personal representative, the name and address of the personal representative’s attorney, and the date of first publication, and the deadline for claims to be filed.
  • Filing proof of publication with the court.
  • Serving the “notice to creditors” on all known or reasonably ascertainable creditors.

The representative must maintain a list of all potential creditors for the court.

Florida Deadlines for Creditor Claims During Probate

Under Fla. Stat. § 733.702, creditors have varying time limits to submit claims against a deceased person’s estate, depending on the type of notice they received. These deadlines aim to balance the rights of creditors to collect debts and the interests of heirs in timely estate distribution.

For creditors who received direct, written notice from the estate’s personal representative, they have the later of the date, that is 3 months after the time of the first publication of the notice to creditors or 30 days after the date of service of the notice to creditors to file their claim.

Those creditors who only saw a published notice announcing the probate case have 3 months from the initial publication date to submit a claim.

However, known or reasonably ascertainable creditors who do not receive direct service of a notice to creditors are allowed the most extended period of up to 2 years after the date of death to make their claim. This protects creditors who should have been directly informed but were not.

By providing these staggered deadlines based on the notice provided, Florida’s probate laws try to create a fair system where creditors have an opportunity to pursue amounts owed while not indefinitely delaying the estate settlement process.

Consequences of Missing the Deadline

There can be serious consequences if a creditor does not submit their claim within the statutory time period:

  • The claim against the estate will likely be rejected if it is past the deadline.
  • The creditor may lose the legal right to pursue collection of the debt at all.
  • There are some exceptions – certain taxes and secured debts may still be enforceable.

To make sure debts are handled properly, consult a probate attorney to verify the deadline for claims in your matter. Carefully review any claims to ensure they are submitted on time and valid. Respond on time and appropriately to any debt collection lawsuits against the estate.

Settling Valid Debts

If the deceased’s estate lacks sufficient assets to fully pay all outstanding debts, Florida law establishes an ordered priority system for distributing payments to creditors.

This priority order is:

  • Costs and expenses of administering the estate, including the personal representative’s fees and attorney’s fees.
  • Up to $6,000 for reasonable funeral expenses.
  • Debts owed to the federal government, such as taxes and Medicaid claims, take precedence.
  • Unpaid hospital and medical bills from the deceased’s final 60 days of life.
  • A family allowance to provide up to one year’s support for a surviving spouse and/or dependent children.
  • Any past-due child support or alimony payments owed.
  • Debts acquired after the death by the deceased’s business interests are paid only from business assets.
  • All other unsecured creditor claims.

Creditors higher on the priority list must be paid in full before claims in lower classes can receive any payment from remaining estate assets. If insufficient funds exist to pay an entire class, those creditors receive partial pro-rata payment.

Certain assets, like a qualified homestead property, may be exempt from creditor claims under Florida’s laws. However, the personal representative can petition to clarify an asset’s protected status if contested.

Get Probate Solutions from Oviedo’s Blue Awning Attorneys

For over a decade, Vollrath Law has provided legal counsel to families in Oviedo and across Central Florida. Our team of dedicated attorneys offers guidance for estate planning, probate, family law, and more.

Known as the “Blue Awning Attorneys,” our firm believes legal matters should be clarified and not complicated. We take the time to understand your needs and offer solutions to support you in reaching your goals.

If you are currently probating a will in Florida, contact us today and learn how we can support you and your family during this time.

Author Bio

Stephanie Vollrath is an Owner and Partner of Vollrath Law, a Florida estate planning law firm she founded in 2013. With more than seven years of experience in investments and financial advising and 13 years practicing law in Florida, she represented clients in a wide range of estate planning cases. Her practice areas include wills, trusts, guardianship, probate, and other estate planning matters.

Stephanie received her Juris Doctor from the Barry University Dwayne O. Andreas School of Law and is a member of the Florida Bar and the Seminole County Bar Association.

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