What is Probate and why should I avoid it?
Probate is the legal process (e.g., court process) of administering a person’s estate when they die. In California, the process can last an average of 18 months, with some probates lasting more than 2 years.
If there is a will, probate will be the process of proving a last will and testament, which means verifying that the will is legal and the deceased person’s intentions as written in the will are carried out. Probate, when there is no will, means that the court decides how to distribute the assets of the deceased’s estate to their loved ones according to the state’s intestacy laws. There will be no flexibility or any way to change how the estate will be distributed if there is no will.
This diagram is a summary of the probate process when there is real property as part of the estate.
As far as the cost for the probate process, it will be paid out of the estate depending on the size of the estate, without subtracting any debts of the estate (e.g., mortgage). This is surprising to many people who think their estate is small because they have a big mortgage. Probate Code Section 10800 sets forth the method of calculating statutory fees for the personal representative and attorney based on the value of the estate:
4% of the first $100,000
3% of the next $100,000
2% of the next $800,000
1% of the next $9,000,000
0.5% of the next $15,000,000
For example, if an estate is worth $1,000,000, the statutory fees paid to the personal representative and to the attorney are $23,000 each, for a total of $46,000!
So, whether there is a will or not, probate is a long process and the estate will be reduced by the fees that will be paid to the personal representative and the attorney. You can avoid probate with a proper estate plan that includes a living trust. In California, a Living Trust is the gold standard and the best way to avoid probate. Give us a call to create your Living Trust or if you have one already, to make sure it’s updated.
Of course, if a loved one dies and probate is necessary, we can help the personal representative navigate the process so there is one less thing for them to worry about.
For your convenience and safety, we are available for virtual consultations. (909) 377-8141. Give us a call to set up a meeting.
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