K
kastnna
Hi all,
Got a quirky situation...
A friend's wife died recently leaving behind little more than her 1/2
ownership interest in their house (JTWROS), a few personal items (e.g.
jewelry), various debts, and a $1M life insurance policy. Her husband
is the sole beneficiary of everything. He was also the named
beneficiary of the insurance policy, so that claim has already been
filed and paid to him directly.
Thus far, the wife has been deceased for three months and the husband
still hasn't opened probate. As a matter of fact, he doesn't intend to
until he's forced to. You see, his wife had a number of medical bills,
credit cards, short-term bank loans, etc... that all have extremely
lucrative terms (low monthly payments and very low rates).
My friend reasons that if he doesn't open probate, he can continue to
dutifully services those debts at low interest rates. However, if he
opens probate, he'll be forced to notify her creditors and pay-off all
her debts sooner rather than later. In other words, opening probate
will force him to accelerate the payment of favorable loans in
exchange for very little in return. The way he sees it, he's got
nothing to lose by keeping probate closed. Obviously, he intends to
eventually open probate once those loans reach maturity and/or once
the introductory rates expire. But that will likely be a year from
now.
Anybody see any flaws in his logic?
Got a quirky situation...
A friend's wife died recently leaving behind little more than her 1/2
ownership interest in their house (JTWROS), a few personal items (e.g.
jewelry), various debts, and a $1M life insurance policy. Her husband
is the sole beneficiary of everything. He was also the named
beneficiary of the insurance policy, so that claim has already been
filed and paid to him directly.
Thus far, the wife has been deceased for three months and the husband
still hasn't opened probate. As a matter of fact, he doesn't intend to
until he's forced to. You see, his wife had a number of medical bills,
credit cards, short-term bank loans, etc... that all have extremely
lucrative terms (low monthly payments and very low rates).
My friend reasons that if he doesn't open probate, he can continue to
dutifully services those debts at low interest rates. However, if he
opens probate, he'll be forced to notify her creditors and pay-off all
her debts sooner rather than later. In other words, opening probate
will force him to accelerate the payment of favorable loans in
exchange for very little in return. The way he sees it, he's got
nothing to lose by keeping probate closed. Obviously, he intends to
eventually open probate once those loans reach maturity and/or once
the introductory rates expire. But that will likely be a year from
now.
Anybody see any flaws in his logic?