Jan52026
Probate Q&A Series

How do I handle a deceased relative’s bank account if the bank says it will be sent to unclaimed property? – North Carolina

Short Answer

In North Carolina, the safest way to prevent a deceased person’s bank funds from drifting into “unclaimed property” is to have a court-appointed personal representative (executor/administrator) promptly present certified Letters (and a death certificate if requested) and move the money into an estate account for administration. If the bank already sent the funds to the State Treasurer as unclaimed property, the funds can usually be recovered by filing a claim with the Treasurer and providing proof of authority and entitlement. Delays often happen when the estate cannot move forward because the will is not self-proved or the court needs additional proof before issuing Letters.

Understanding the Problem

In North Carolina probate, a common question is: can the estate stop a bank from closing a deceased relative’s account and turning the balance over to the State as unclaimed property, and what steps must the personal representative take to collect the funds? The key decision point is whether the estate has a qualified personal representative with court-issued authority to act, because banks typically require that authority before releasing funds. Timing matters because banks often freeze or close accounts after learning of a death, and the estate may need the funds to pay expenses and complete required filings with the Clerk of Superior Court.

Apply the Law

North Carolina treats “unclaimed property” and “escheat” as a process where certain property is paid over to the State Treasurer to hold for the rightful owner or claimant. In an estate context, unclaimed or unrecovered estate funds can be paid to the State Treasurer in limited situations, and heirs or creditors can later file a claim to recover what is held. Separately, many bank accounts pass outside probate by contract (for example, joint accounts with right of survivorship or payable-on-death designations), but those funds can still be subject to recovery by the personal representative if needed to pay valid estate debts when other assets are not enough.

Key Requirements

  • Authority to act for the estate: A personal representative generally needs court-issued Letters (Letters Testamentary or Letters of Administration) or another recognized probate shortcut (when available) before a bank will release funds into the estate.
  • Correct account classification: The bank account may be (a) a probate asset payable to the estate, (b) a joint account with survivorship, or (c) a payable-on-death account. The account agreement controls who owns the funds at death, and strict compliance with the account-creation rules matters for beneficiary designations.
  • Proper handling of collected funds: Once collected, estate cash should be deposited into an estate checking account opened after qualification, using an estate taxpayer identification number (not the decedent’s Social Security number), so the personal representative can track receipts and disbursements for required estate filings.

What the Statutes Say

Analysis

Apply the Rule to the Facts: The estate administration has slowed because the probate court flagged a technical issue with the will, which can delay issuance of Letters and, in turn, delay the ability to collect the decedent’s bank funds. If the bank account is a probate asset (no survivorship owner and no payable-on-death beneficiary), the personal representative typically needs certified Letters to have the bank close the decedent’s account and pay the balance to the estate. If the account is a survivorship or payable-on-death account, the bank may pay the surviving owner or named beneficiary, but the personal representative may still need to evaluate whether recovery is necessary to pay estate debts if other estate assets are insufficient.

Process & Timing

  1. Who files: The personal representative (or the person seeking to qualify). Where: The Clerk of Superior Court (Estates) in the North Carolina county where the estate is opened. What: The filings needed to qualify and obtain certified Letters; if the will is not self-proved, follow-up may include obtaining a proper self-proving affidavit or other proof required by the clerk. When: As soon as possible after death, because banks often restrict access once notified.
  2. Collect and secure the bank funds: After qualification, request the bank’s estate-collection process in writing and provide certified Letters (and a certified death certificate if requested). Then open an estate checking account promptly after qualification and deposit the collected funds into that estate account using an estate taxpayer identification number (not the decedent’s Social Security number) so transactions can be tracked for inventories and accountings.
  3. If the bank already sent the money to unclaimed property: File a claim with the North Carolina State Treasurer’s Unclaimed Property Division and submit proof of identity and entitlement (often including Letters and a death certificate). Under North Carolina law, the Treasurer generally must allow or deny a filed claim within 90 days, and if allowed, pay or deliver the property within 30 days after approval.

Exceptions & Pitfalls

  • Assuming the will controls the bank account: Joint accounts with right of survivorship and payable-on-death accounts usually transfer by the account contract, not by the will. The estate may still be able to seek recovery only to the extent needed to pay valid debts if other estate assets are insufficient.
  • Not opening an estate account promptly: Banks commonly close the decedent’s accounts after the personal representative qualifies. Opening an estate checking account quickly helps prevent lost checks, misapplied deposits, and accounting problems later.
  • Using the wrong taxpayer identification number: An estate account should use an estate taxpayer identification number, not the decedent’s Social Security number, and banks may request tax forms for interest-bearing accounts.
  • Waiting too long to prove authority: A technical defect in a will can delay qualification and access to funds. Addressing the proof issue early (for example, obtaining the needed affidavit or other proof the clerk requires) can reduce the risk of the bank treating the account as abandoned.
  • Incomplete unclaimed property claim package: Claims often stall when documentation does not match the bank’s records (name variations, address history, or missing proof of authority). Submitting certified Letters and clear proof linking the decedent to the account usually matters.

Conclusion

In North Carolina, handling a deceased relative’s bank account usually starts with qualifying a personal representative and obtaining certified Letters, then presenting those Letters to the bank so the funds can be paid into an estate account for proper administration. If the bank has already sent the funds to the State Treasurer as unclaimed property, recovery typically happens through a formal claim supported by proof of authority and entitlement, and the Treasurer generally must decide the claim within 90 days. The most important next step is to obtain certified Letters from the Clerk of Superior Court as soon as the will-proof issue is resolved.

Talk to a Probate Attorney

If a bank account is frozen after a death or a bank says the funds will be sent to unclaimed property, our firm has experienced attorneys who can help clarify what documents the bank and the Clerk of Superior Court will require and how to protect the estate’s timelines. Call us today at (919) 341-7055.

Disclaimer: This article provides general information about North Carolina law based on the single question stated above. It is not legal advice for your specific situation and does not create an attorney-client relationship. Laws, procedures, and local practice can change and may vary by county. If you have a deadline, act promptly and speak with a licensed North Carolina attorney.

Category: Probate Q&A Series

Author: Pierce Law

Pierce Law Group is a North Carolina law firm focused on probate administration, real estate partition matters, and surplus funds claims across North Carolina. We know these situations often come with stress, family dynamics, and time-sensitive decisions—so we prioritize clear communication, steady guidance, and a practical plan from day one. Our goal is to make a complicated process feel manageable, while protecting what matters most to you.