What Happens During Probate?
Are you facing probate? If so, you may feel like this is the most difficult process of your life.
Probate is the legal process of moving property and assets from a person who is deceased to others, like their beneficiaries. It settles all debts against the person who has passed. It also potentially levies taxes on the property. Probate without a will can mean the government is in more control over the outcome of your loved one’s property. However, there is help available to you to preserve and minimize those losses.
Without a Will
It’s important to think about a will for what it is. Unlike on television shows, there is not usually a long, sentimental moment where people spill their secrets and reveal unnamed previous heirs. Rather, this is a legally binding document. It typically outlines the wishes of the person who dies. This person has the right to make decisions about what happens to property, who takes care of the dependents, and how their home is sold. Without this type of document, the court has to gather information, make decisions for the person, and consider what the best possible outcome is. Do you really want your family’s future to hinge on the decisions of a busy judge?
When it comes to probate without a will, you can count on experiencing some difficulties and limitations. If a person dies without a will, the state’s probate system works to resolve the assets and debts of that party. This includes taking steps to liquidate the estate – such as selling property – to pay off debts. All of the decision making is done by the state, not the family. While most of the property still transfers to the family, estate taxes may apply, reducing the end property value.
Future Planning Is Really the Route to Take
Let’s say you are planning for your future. You want to take steps to minimize the long-term risks to your estate. With future planning, you are able to create trusts and a will to provide more direction for what happens to your estate after you die. You may be able to reduce estate taxes and preserve the value of your estate, making sure your desired heirs receive what you desire.
The problem is, many people don’t plan this. They often leave behind their assets and let the court decide. In fact, AARP found just 40 percent of American adults have a willing or a living trust. Future planning with a trust and will is critical to do now – not in a year or two. Yet, many don’t do this.
Most People Misunderstand Probate
Probate is a complex process with plenty of limitations. Yet, it’s also important to truly understand this legal process.
First, probate can happen whether you have a will or not, but if there is a will, the process is faster and decisions made are your own.
Second, a person can name an executor of the estate in their will, or the court will appoint one – it does not have to be the oldest child.
It’s also important to recognize that the government doesn’t take everything if you die without a will. Rather, the government gains control over making decisions about what happens to your property. That’s much worse. However, it should also help you to feel empowered – with a will, you gain more control even if you are not there to do so.
There’s also a common misconception about who should handle this process for a family. No matter if you are planning for your future goals or you are facing probate for a loved one’s estate, you should have an attorney to represent you. However, not just any attorney is effective. Look for one with specific skills in this area.
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What Is the Probate Process?
State laws play a role in determining what the outcome is. For example, state laws can determine if you can sell the house and who has the right to make those decisions. It can also play a role in deciding who should be considered an heir, how much property a spouse can obtain, and the steps in authenticating a will.
Managing the Process – Costs and Fees
The probate house sale process itself can take time and can mean significantly reduced value. You’ll have to pay for appraisals, real estate agent fees, and title searches. It adds up fast and typically means the value of the estate – or the property transferred to heirs – is less than what it could be otherwise.
Avoiding Probate Is a Big Deal
There are so many questions that come into play when a loved one dies. What did he or she want? What should happen? These are often questions regarding large assets. Can you sell an inherited property before probate? Can you sell a house in probate if you just do not want to own and manage it? Over time, the process – which generally can take a year or longer – can become overwhelming on the heirs. Soon, they just want to settle it all and be able to walk away. That’s not what you want to see happen.
That’s why there are so many options available to avoid probate. It’s possible to do so in several ways, such as joint ownership of the property, giving property away before death, and designating beneficiaries in the process.
A living trust is perhaps the best tool for most people because it allows for the protection of many assets. The trust works to shield many of those assets from taxes and gives the property owner the ability to move property without risk.
Can You Sell a House
This is another decision you have to consider. In some states, it is possible to do this, which can free up a significant amount of time and concern over the property. It can also encourage a faster and less expensive way of getting rid of property that no one wants to own or cannot own going forward. An investor can prove to be one of the best ways to minimize many of the difficulties associated with the process.
What Assets Should You Plan for or Manage?
It’s a good idea to be open and honest about any property owned by your loved one. Do not try to hide information or data. Rather, trust your probate lawyer to be able to help you minimize these risks and costs. This includes any property questions but also about the process, claims made against the property, and any other concerns you have.
What’s Not at Risk?
Probate is not a simple process and can be frustrating. However, as a property owner, it is important to make decisions about these assets in advance. If you are the executor of the will, or the person responsible for managing this process, turn to an attorney who can guide you. Learn about the process as well as all of the risks you are taking on, so you are prepared to handle the process.
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