Most in San Jose likely believe that they will have years to plan for their estates. Yet what happens if your spouse dies unexpectedly while still relatively young? Even in the event that you had both planned ahead and created estate planning documents, it is likely that you still have outstanding debts that those who pass on in their elder years might not have to deal with. You might be facing the potential of having to liquidate assets in order to settle your spouse’s liabilities. Many in your same position come to us here at Temmerman, Cilley & Kohlmann, LLP wondering if that means selling their homes.
Depending on the amount of debt you are left to deal with, it might. What, then, is to happen to you and your children? Are creditors able to come in and immediately force the sale of your home and other personal property, effectively leaving you on the street? According to Section 6500 of California’s Probate Code, they are not (at least not in the immediate aftermath of your spouse’s untimely death). In fact, this statute allows you to maintain the use of your spouse’s home and personal property for yourself and your children up until the filing of the estate inventory and for an additional 60 days after that (additional time extensions may also be available through a petition to the court).
One way to retain ownership of your home and other property after your spouse’s death may be through a life insurance payout (which is why experts recommend securing enough insurance to at least cover the cost of your mortgage). Another may be to try and work with creditors to repay debts over time as opposed to an estate sale. Other methods of settling an estate’s liabilities can be found throughout our site.