Creditors operating businesses in Florida or who have domesticated judgments in Florida have legal rights. They can engage in collection activity ranging from making phone calls to filing a civil lawsuit to help recover the amount owed.
When the person who owes money to you suddenly dies, you may feel like you have no choice but to write off the remaining balance on their debt. However, your collection rights persist even after the person who owes you money dies. You will need to act in a timely manner to collect on a debt from someone’s estate.
State law limits how long you can make a claim after someone dies
The executor of an estate cannot distribute property owned by the deceased party until they repay all of that person’s debts. To obtain repayment, you may need to make a formal claim against the estate. Under state law, you can potentially collect on a valid debt for up to two years after a debtor’s death.
However, their executor initiating probate proceedings will speed up that timeline. You typically only have 30 days to file a claim after you receive written notification directly from an executor.
If the executor doesn’t provide you or your company with a direct notice about probate proceedings, you will have 90 days from when they publish a Notice to Creditors. If you discover that the executor distributed assets without repaying you first, you may be in a position to file a claim against them and hold them personally accountable for those mistakes.
Knowing your rights as a creditor when a debtor dies can help you get the money you deserve from their estate.