How do debts & liabilities work?

Your Executor is responsible for paying off your outstanding debts using the money you leave behind in your Will. These liabilities and debts should be paid prior to estate funds being transferred to your beneficiaries.

If there’s not enough cash in your estate to cover the debts, your Executor must sell property or other assets to discharge them. If there’s still not adequate funds to cover debts after assets are sold, then the estate would be insolvent and special distribution rules apply to govern the order to payment.