What is the Probate Process?

Probate ProcessGenerally speaking, the probate process is used by state probate courts to transfer property to your heirs. It is really just a judge giving legal permission for assets to be passed on, whether or not you have a will.

In California, estates can be settled in a matter of months without formal probate proceedings using relatively simple transfer procedures (Simplified Probate Procedures) if the gross value of all real and personal property owed by the estate is no more than $150,000 (the total value of the property, with no deductions for money owed on the property).

Why Avoid Probate?

Estates larger than $150,000, however, must go through a lengthy formal probate process. Unlike the Simplified Probate Procedures, formal probate proceedings can take a year or longer to complete.

Probate statutory fees for probate lawyers and executors are also quite costly, and are charged against the estate’s assets:

4% of the first $100,000 of the gross value of the probate estate.
3% of the next $100,000.
2% of the next $800,000.
1% of the next $9 million.
0.5% of the next $15 million.

The formal probate process also raises serious privacy concerns. Probate creates a public record, that anyone can access, of matters you may prefer to keep private, including what you owned, to whom it was left, and even the terms of a prenuptial agreement.

It is oftentimes advisable to avoid the probate process in order to avoid the delay, cost, and privacy concern discussed above.

So How Do You Avoid Probate?

One of the most common ways to avoid probate is with a properly prepared living trust. A living trust (“inter vivos” or “revocable” trust) holds a person’s property for his or her benefit during that individual’s lifetime. Then, upon the person’s death, the assets are transferred to designated beneficiaries by the “successor trustee,” the person who had been chosen by the trust creator to do so.

A living trust is called “revocable” because it’s terms can be changed at any time, or the trust can be cancelled entirely.

When you place property in a living trust, you can avoid probate because the successor trustee distributes assets according to your instructions. Your successor trustee does not need court permission to do so. This can mean a faster distribution to your heirs, shortening the time frame from months or years to just weeks, without any additional expenses to the estate.

As discussed above, a living trust can save money by avoiding probate expenses at your death. Equally, or perhaps more, important: Unlike the probate process or a will, a living trust is a private document between the parties involved, and does not become part of the public record. In other words, no one can later go and search public records to find out more about the distribution of your estate.

Contact Us to Discuss Options

Sound interesting? Depending on your particular needs, there may be additional benefits a living trust can provide. Creating a living trust doesn’t have to be time consuming, complicated, or expensive. Contact attorney Pablo Tagre at the Tagre Law Office, APC – 209-877-7457 – to schedule a time to discuss your options.