Bremerton, WA asked in Estate Planning, Family Law and Probate for Washington

Q: What constitutes a insolvent estate? My father passed away leaving his property to with a attached mortgage.

He also left a life insurance to me that was to go to pay off mortgage. The Life insurance claim was denied. He has a large amount of money in bank acct he left to another family member. Can that money be used to help payoff mortgage?

1 Lawyer Answer
Brent Bowden
Brent Bowden
  • Estate Planning Lawyer
  • Lynnwood, WA
  • Licensed in Washington

A: An insolvent estate is an estate where the debts exceed the assets. In other words, the estate is not going to have the ability to pay all of its creditors.

The question of whether money left to a specific beneficiary can be used to pay the debts of the estate (like the mortgage) is probably not one that can be answered definitively without a more detailed consultation. I would suggest you consult with a qualified probate attorney in your area. Generally speaking, those specific bequests of money or other property can only be invaded to pay debts of the estate if there are otherwise insufficient assets to pay the debts of the estate. A mortgage is a debt of the estate, but if the real estate is worth more than the outstanding mortgage, the real estate itself can be used to pay the mortgage debt.

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