Important Information about Probate and Why You Should Avoid It If Possible
By definition probate is the legal process for the transfer of assets-houses, cars, stocks, bonds, boats, etc.-from the deceased person’s name to his or her estate so they can be sold or distributed to the heirs. California probate is nothing more than a title clearing process. The state judge appoints the personal representative, the personal representative collects all the assets, pays all the valid debts from the assets collected and distributes the money to the rightful heirs.
You can avoid probate if you plan ahead. The benefits are lower costs for your estate administration and less frustration for your family. With a few simple steps, you can spare your loved ones a lot of time and money. Probate court proceedings (during which a deceased person's assets are transferred to the people who inherit them) can be long, costly, and confusing, and can drag on for a year or more and cost your family tens of thousands of dollars. That’s why many people take steps to spare their families the hassle. Different states, however, offer different ways to avoid probate. Here are the options in California.
1. Living trusts
In California, a living trust helps to to avoid probate for virtually any asset you own -- real estate, bank accounts, vehicles, and so on. A trust document is created (it's similar to a will), naming someone to take over as trustee after your death (called a successor trustee). Then -- and this is critical -- you must transfer ownership of your property to yourself as the trustee of the trust. Only then will the property be controlled by the terms of the trust. At your death, your successor trustee will be able to transfer it to the beneficiaries named in the trust without probate court proceedings.
2. Joint ownership
If you own property jointly with someone else, and this ownership includes the "right of survivorship," then when one owner dies, the surviving owner automatically owns the property. No probate will be necessary to transfer the property, however paperwork needs to be filed to show that title to the property is held solely by the surviving owner.
Here are two forms of joint ownership available in California:
· Joint tenancy: When one owner dies, property owned in joint tenancy automatically passes to the surviving owner, and probate is not necessary. In California, each owner or ‘joint tenant’, must own an equal share.
· Community property with right of survivorship: In a community property state like California, spouses and registered domestic partners generally own all property acquired during the marriage jointly unless they specifically designate to keep it separate. When one spouse or partner dies, an asset which title is held as community property with the right of survivorship automatically passes to the survivor. Check your vesting for your property as some properties are held as community property - but without the right of survivorship. This blog was provided by Susan Davis, Realtor with Pedersen Real Estate.
There are two agents at Pedersen Real Estate who are Certified Probate Real Estate Specialists: Susan Davis (email: Email@SDavisHomes.com) and Vera Gleason (email: firstname.lastname@example.org).