Comment by jaclaz

Yes, that is exactly like it works in Italy, the inheritance is made of credits/assets+debts, the heir(s) can (should) evaluate the + and the - and then have the option to either accept or refuse the inheritance as a whole (the good and the bad together).

It is not common that heirs refuse an inheritance as usually the overall balance is positive, but it can happen, in these cases (like the case where there are no known heirs) the whole inheritance goes to the state, that proceeds - as you said - to liquidate the property and repay - in whole or partially - the debts.