Legal Question in Wills and Trusts in Massachusetts

Liability of car loan from deceased parent

My father just died, left only debt and a small life insurance policy. My

mother is the beneficiary. They are legally married but have been separated

for 5 years. She lives in New York State. He left an auto loan. If we ask the

bank to reposses the car would she or any of his children be liable or held in

any way responsible? The loan was in his name only. There are no assests in

his name.

Asked on 7/21/05, 7:12 pm

2 Answers from Attorneys

Joseph Murray Joseph M. Murray, Esq.

Re: Liability of car loan from deceased parent

The Auto Loan would be a debt of the Estate which the bank would have to present as a claim against the estate within a year of the date of death to be enforcible. Repossession by the bank would only add the reposession cost to the debt and result in a forced sale at an undervalued price. It might be better to negotiate with the bank to allow the vehicle to be sold for a price they would accept to release the loan as paid in full if at all possible. But it would not become a debt to the heirs except to the extent it may be a debt of the estate itself.

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Answered on 7/21/05, 10:55 pm

Re: Liability of car loan from deceased parent

Basically the assets and debts of the estate are just that. The hiers would not have personal liability unless they took an asset from the estate improperly.

With respect to the auto and the auto loan, I would suggest that you negotiate with the lender to settle the car loan out or sell the car for the amount of the loan if possible. Repossession simply adds expenses.

As to other debts, they have claims against the remainder of his assets to the extent they exist other than retirement accounts if left to individuals and not the estate.

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Answered on 7/22/05, 12:31 pm

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