Paying off debts

Dear Atty. Peachy,

Prior to my father’s death about a month ago, he was in a relationship with a woman who manipulated him in every way. I tried talking to him about how this woman was just after his money but he did not listen to me.

I ended up just letting him be, thinking that he deserves to be happy after mourning the death of my mother for five years.

Now that he has passed, I discovered that he apparently incurred a lot of debt while trying to sustain the extravagant lifestyle of his girlfriend. He even had to take a huge loan from one of his best friends to finance the business venture of his girlfriend.

My wife and I are scared of the debt that I inherited from my father. We have just bought our own house and my earnings are just enough to support the daily needs of my family, including the education of my two kids. We are worried that my father’s creditors will go after our house if the real and personal properties of my father is not enough to pay off his debts.

Please help us.

Oliver

Dear Oliver,

While the death of a debtor does not extinguish his obligations, his heirs technically do not inherit his debts the way they inherit property or other assets from him.

Creditors do not have the right to go after the assets of parents, children, siblings or any of the heirs of the debtor. The obligation is not transferred to the heirs but to the estate of the deceased. The creditor may file a claim against the deceased’s estate to recover the owed amount.

The executor, the person named in a will to carry out what it says after the person’s death, is responsible for settling the deceased person’s debts. If there is no will, the court may appoint an administrator, personal representative, or universal successor and give them the power to settle the affairs of the estate. If the estate cannot pay it and there is no one who shared responsibility for the debt like a guarantor or co-maker, it may go unpaid.

Thus, even if creditor of your father attempts to request payment from you, you have no legal obligation to pay. Your father’s debts may be deducted from his estate but cannot be collected from you and your assets. Your inheritance may be reduced or you may end up not inheriting anything from your father because of the payment of his debts from his estate, but you cannot be held personally accountable for any of the outstanding debts of your father that cannot be covered by his estate.

Atty. Peachy Selda-Gregorio