Q: Received collections letter for my deceased mother, after Notice to Creditors was published & claims deadline passed.
My mom was in the process of filing bankruptcy when she passed away 6 mo ago, but hadn't filed with court. I am successor trustee of her trust, but her attorney wouldn't release her file without a subpoena & retired within days of my contact with him. Without knowledge of who her creditors were (she didn't have current documents in her home), I published a Notice to Creditors in the newspaper. The 4 mo deadline has since passed. I just received a letter from a collection agency, addressed to my mother at my CA address (her mail has been fwd to me), with a settlement offer for an unpaid credit card debt. It does not appear they know she is deceased. Do you suggest I contact them by phone or writing to inform them of her passing? Do I need to disallow this claim even though the collections letter was addressed to my mother, not the trustee, and the deadline established by the Notice to Creditors has passed? What are the trust's obligations to the debt at this point?
A: It's generally good that the 4-month window has closed; however, there is a requirement to send a notice to all known creditors, as well. Creditors could argue that they are entitled to a notice directly. It depends on what steps you took to locate any known creditors. Another factor is how much the estate is worth. An insolvent estate will likely lead to a different answer than a million dollar estate, for example. An experienced probate attorney can likely guide you to the best answer once he or she knows more of the pertinent facts. Good luck!
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