5 Tips for Dealing with Claims: Tip 1
1. The first thing you have to ask yourself is, "should we even open a probate estate right now?" If a decedent's estate appears insolvent (that is, the value of the potential claims exceeds the value of the decedent's property), maybe you never open an estate. Or, maybe you wait for two years to open it. Two years is the magic number because, under Section 18-12 of the Illinois Probate Act, most claims are barred as of that date (even if no probate was opened).
The question in these cases is whether the hardship (of not opening the estate for two years) outweighs the benefit (potential claims avoidance). Opening a probate estate, and getting a personal representative appointed, means that someone is entitled to deal with the decedent's property (including sell it). But some families are in a position where the money isn't needed ASAP, and the status quo is fine. In those cases, no probate for two years may mean the claims all go away. (Creditors can in some situations open a probate estate, but most creditors don't want to go to the trouble to do so.) For instance:
Tom dies owning a $200,000 bank account. Tom owes $30,000 in credit card bills. Upon Tom's death, his Will gives his property to his two siblings, Jean and Janet. Jean and Janet can:
-open an estate now, knowing that they'll get $170,000 (because the credit card company will probably file a claim); OR
-let the bank account sit for two years, hope that the credit card company doesn't seek to open the probate estate on their own, and then open a probate once the two years have passed. If all goes according to plan, Jean and Janet get the full $200,000.
