What is Probate and why should I avoid it?
Helpful important expert advice from probate attorney in El Dorado Hills, Folsom, Soojin Kim
Probate is a legal process for distributing a deceased person’s property to their heirs and beneficiaries and settling any debts.
The process is a difficult one because the deceased person’s family, who are already grieving, must file the proper forms with the court to open, inventory, and close probate.
For example, Mr. A owns a home and he still owes money on the mortgage. He also owns one car and makes car payments. Mr. A passes intestate (without a will), and he is survived by his only daughter. Now the daughter has to go through probate to settle her father’s estate. With the help of a probate attorney, she files a petition to open probate and name her an Administrator for the estate. When the judge signs the order and names her Administrator, she now has the responsibility to figure out what assets are in the estate and maintain the assets until the close of probate. What does it mean to maintain the assets? With the home and the car, she has to make sure the monthly mortgage and insurance payments are made. This is likely the most difficult aspect of probate for many clients. For Mr. A to make a monthly payment of $1,500 for the home and the car, it was doable because he received a pension and social security retirement. For the daughter to pay an additional $1,500 for her father’s home and car, it is a burden. If the daughter is unable to make monthly mortgage payments and the mortgage company forces a trustee sale, then the daughter loses her father’s home.
Probate is also a very long process. In Sacramento County, to get a hearing to name the Executor/Administrator, it can take 5-6 months. Then the probate case must stay open for a minimum of four months to allow creditors, if any, to come forward and claim a debt against the estate. The final petition to close probate and distribute the estate to the beneficiaries requires another hearing and that can also take 5-6 months. Realistically, a simple probate will take over a year to complete. That means, the heirs/beneficiaries have had to maintain and make any payments on the assets in the estate during that long court process.
A living trust is a way to avoid probate. Assets held in a living trust are not probated. If you have a home, consider putting that asset into a living trust. In the trust you can appoint someone to manage that asset in your absence and you also state who your beneficiaries are. Then the process of gathering assets and distributing to the beneficiaries is a private one, not done on public record like probate. Also, the timing can be determined by your successor trustee and beneficiaries, not by the court.
We proudly serve our clients during difficult times in the Folsom, El Dorado Hills and greater Sacramento Valley.
If you have any questions or want help with this process, please contact us at:
Soojin Kim, Attorney at Law
4989 Golden Foothill Pkwy., Ste. 6
El Dorado Hills, CA 95762