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CA estate planning, what will happen to debts and assets upon death

My mother has lung cancer, currently lives with my sister. Only assets she has are a paid-for Ford Focus, her clothes and inexpensive jewelry, $5,000 in the bank, a $5,000 life insurance policy, a small pension death benefit, and Social Security. She is currently charging all her expenses on credit cards, because my sister is unemployed and can't contribute other than keeping the roof over her head. What will happen when she dies and her credit card bills exceed her assets?

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Attorney answers (1)

Reputation Level 9
The California Probate Code has provisions on who get paid and in what priority. if the Estate has greater debt than assets then nothing will be distributed from the probate to the beneficiaries. Life insurnace is different as the company pays the listed beneficiary not the probate estate normaly. The assets that are part of the probate estate are liquidated to pay the debts and expenses of the probate.
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