Finding Estate Debts (OR)

Updated Jul 7, 2024

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As part of taking inventory, an estate executor must look for and validate the debts of the decedent's estate.

Notice of Death Publication

If the estate is going through probate, the executor must typically publish a notice of death in the local newspaper where the decedent lived (see Sample Estate: Task - Publish Notice of Death). The purpose of this notice is designed to inform potential creditors of the death, and while details vary from state to state, creditors typically have 3 to 9 months to contact the estate about any debt claims. If a potential creditor misses the claims deadline then the estate would not typically have a legal obligation to pay the debt (see Sample Estate: Task - Debt Claims Expired). Note that debts to the federal government are often an exception to this rule.

Even if the estate is small enough to avoid probate in OR, the executor may still wish to publish a notice of death, to protect the estate from future debt claims, which could be quite problematic if the estate assets have already been distributed.

OR Specifics

In Oregon, the executor must, upon appointment, publish a notice to interested persons once per week for 3 consecutive weeks in a newspaper of published in the settlement county (or one designated by the court). The notice should announce the executor appointment and notify creditors that they have 4 months from the date of first publication to make any claims.

Additionally, the executor has 3 months from date of appointment to make reasonably diligent efforts to identify estate creditors, individually notifying all known creditors before 30 days pass beyond the end of the investigation period. The individual notice should inform the creditor that they have 45 days to submit any claims. It is not necessary to notify a creditor that has already made a claim.

Within 60 days of the expiration of this claim period, the executor must file proof of notice compliance with the court.

See Oregon Revised Statutes § 113.155 and Oregon Revised Statutes § 115.003.

Informal Debt Claims

There are certain debts you will quickly discover as you go through the decedent's mail, or are contacted by creditors, such as insurance premiums, credit card balances, utility bills, and so forth.

If desired, you can also run a credit report on the deceased, perhaps discovering debts about which you would otherwise be unaware. You may be able to get the credit report for free if and when you notify the credit reporting agencies of the death.

You don't necessarily have to pay any of these debts unless the associated creditor makes a formal claim against the estate, potentially in response to the notice of death, but most executors will opt to do so in an attempt to "do the right thing". Moreover, failing to pay some of these ongoing bills may result in unwarranted harm to the estate (such as foreclosure or frozen pipes bursting): see Resolving Debts: Ongoing Bills.

In any case, these bills will likely continue to arrive over time, so it will likely be several months before you have a complete picture of all debts.

Statute of Limitations and Claims Deadlines

All states impose statutes of limitations on debts, meaning that after a certain amount of time passes from a debt's due date, the courts can no longer require the debtor to repay the debt. Typically, these time limits range from 3 years for open accounts (such as credit cards) to 10 years for contract debts.

When someone dies, these statutory limitations are often both extended and shortened. They can be extended in that the expiration period is often put on hold for a few months, so that everyone has a chance to get organized and sort things out. This "hold" is officially called "tolling" the debt, but is not usually a major factor since statutory limits are measured in years.

However, statutory limits are also shortened in that almost all states have mechanisms for the estate to establish a time limit for claim submissions measured in months, not years, and these shortened limits overrule any statute of limitations (in other words, even if a statute of limitations implies that a debt would still be enforceable, it will not be enforceable if the estate limits have kicked in). The section above on Notice of Death Publications explains how the estate can limit the exposure to debts.

Note that debts which become time-barred (i.e., become unenforceable due to the statute of limitations), are considered "cancelled" by the IRS, and generate a taxable event, which the creditor may report to via a Form 1099-C (see IRS: Taxes on Canceled Debt).

OR Specifics

In Oregon, creditors have 4 months from the date of the first publication of notice to creditors to register any claims with the court. If a creditor was required to receive direct notification, then that creditor has until 45 days from the date the notice was delivered to the creditor's last known address, or the general 4-month creditor deadline, whichever comes later.

In any case, creditors are barred from making any claims once 1 year has passed since the death (see Oregon Revised Statutes § 12.090 (2)).

Within these rules, Oregon maintains a 6-year statute of limitations on general debts, from original due date or most recent payment, whichever is later (see Oregon Revised Statutes § 12.080). Contracts for sale are handled according to Uniform Commercial Code guidelines, and have a 4-year limit (see Oregon Revised Statutes § 72.7250).

These limits do not apply to mortgages or other liens on real property.

See Oregon Revised Statutes § 115.005