If my father is owed money and has a promissory note, when he dies doI get to collect the debt or does it have to be specified in his Will or the note?
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If my father is owed money and has a promissory note, when he dies doI get to collect the debt or does it have to be specified in his Will or the note?
Asked on August 11, 2011 New Jersey
Answers:
FreeAdvice Contributing Attorney / FreeAdvice Contributing Attorney
Answered 12 years ago | Contributor
If your father passes without assigning his interests in an unpaid promissory note by way of a written document, the unpaid promissory note becomes and asset of his estate to be distributed in accordance with his wishes in a written will or trust as the beneficiaries.
If the promissory note is unpaid at his death, but not yet due, then the beneficiary under the will or trust becomes the owner of the document for future payment.
If the promissory note is being paid on a monthly basis at your father's passing, the estate receives the payments as they come in to be placed in an interest bearing account for the beneficiaries of the estate.
If the person owing on the promissory note has failed to adhere to the payment terms when your father passes and a legal action is a viable solution to collect upon the unpaid note, then the representative of the estate most likely would bring an action to collect upon the note for the beneficiaries of your father's estate.
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