Detailed Answer
When someone passes away in New Mexico, their personal representative (sometimes called an executor) steps in to gather assets, pay debts and expenses, and distribute what remains to heirs. Managing ongoing bills and estate-related expenses promptly protects estate assets and reduces personal liability for the representative.
1. Secure and Inventory Assets
Immediately after appointment, the personal representative should:
- Change locks or secure real estate.
- Maintain property insurance and pay premiums.
- Open a dedicated estate bank account to separate estate funds from personal funds.
- Compile an inventory and appraisal of estate assets. (See NM Stat. §45-3-801.)
2. Pay Ongoing Household and Service Bills
The estate can—and should—pay:
- Utilities (electric, water, internet).
- Mortgage or rent, property taxes and homeowner’s association fees.
- Insurance premiums on real estate, vehicles, or other insured assets.
- Ordinary maintenance costs (lawn care, minor repairs).
Use the estate bank account. Keep receipts and records of all payments to document proper use of estate funds.
3. Notice to Creditors and Claim Payments
Under New Mexico law, the personal representative must notify creditors so they can file claims against the estate. (See NM Stat. §45-3-501.) After the claims period closes, the representative pays valid claims in the priority set by statute:
- Funeral and administration expenses.
- Family allowance.
- State and federal taxes.
- Secured claims (e.g., mortgages).
- Unsecured general creditors.
For details on claiming and paying estate debts, consult NM Stat. §45-3-701.
4. Petitioning the Court for Extraordinary Expenses
If the estate lacks sufficient funds for major bills—like substantial repairs or mortgage arrears—the personal representative may petition the probate court for permission to advance funds or to sell estate property. Detailed procedures appear in NM Stat. §45-3-104.
5. Final Accounting and Distribution
Once bills and claims are paid, the personal representative files a final accounting. This shows all receipts, disbursements, and remaining assets. After court approval, the representative distributes the remaining estate to heirs.
Disclaimer: This article is for informational purposes only and does not constitute legal advice. Consult a licensed attorney in New Mexico for guidance tailored to your situation.
Helpful Hints
- Open the estate bank account as soon as you are appointed.
- Pay mortgage and insurance premiums on time to avoid penalties.
- Keep meticulous records: dates, amounts, purposes and payees.
- Track creditors’ deadlines—missing them can bar valid claims.
- Consult a probate attorney before selling major assets.