QUESTION
What gets paid first from an estate account: a mortgage or signature loan?
Asked on Aug 10th, 2015 on Estate Litigation - Georgia
More details to this question:
The house in the estate is going into foreclosure. There is still money owed in the mortgage, and there is a signature loan with the same bank. There is not enough money left in the estate to pay off either amount. Which should be paid what is left in the estate first? Is this something that the estate has to pay?
1 ANSWER
Probate Litigation Attorney serving Lawrenceville, GA
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Robert W. Hughes & Associates, P.C.
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Secured loans and unsecured loans stand on the same level in the probate court. The secured loan holder will seize the asset securing the loan. The remaining balance after selling the seized asset will become an unsecured loan just like the unsecured loan. If you have multiple unsecured loans and not enough money to pay them all in full, you should pay each one a proportionate amount of money after paying all other priority bills. Priority bills include administrative expenses, funeral and burial expenses and taxes among other things. You should consult with an attorney who specializes in probate administration before paying the bills and later discovering that you paid the wrong bills and now have to come out of pocket to pay the appropriate bills.
Answered on Sep 07th, 2015 at 7:57 AM