Question No. 1

WHAT IS THE BENEFIT OF AVOIDING PROBATE?

There are three important reasons why you might want to avoid probate.

1.     Probate costs can be significant. Often times attorneys and executors ask for extraordinary fees and the courts are unpredictable.

2.     By passing probate avoids delays in transferring assets. The probate processing will typically last from nine months to two years. Sometimes estates are held up for years. The courts require a lot of documentation. Usually, your heirs do not have ready access to the assets in the estate during this time. Selling assets during the Probate process is difficult. If your heirs need funds for living expenses, they cannot access them without approval of court. Each time court approval is requested there is the consumption of extraordinary professional services and a waiting period. Also there is the uncertainty that the court will delay its decision over a small technicality.

3.     Avoiding probate generally protects your privacy and that of your heirs. Probate allows the details of your estate to become a matter of public record.

What is the disadvantage of avoiding probate?

There are two important disadvantages:

1.     You distance your estate from court supervision. You may want the court to supervise the actions of your attorney or trustee.

2.     Cost control. In a probate the attorney will only receive payment after the court approves. In a trust situation the attorney sends the Trustee a request for payment.

Question No. 2

DOES A TRUST CREATED BY WILL PROTECT ME IF I BECOME INCAPACITATED?

No. Because, a will does not take effect until you die, it cannot manage your estate or provide for your dependents in the event you become unable to do so yourself. The ability to manage your estate while you are impaired is one of the truly great side benefits of a trust for a single person or, where assets are under $625,000.

By contrast, a living trust allows you to address those sensitive issues before they occur. Often times a conservatorship can be avoided by a living trust.

Question No. 3

ISN'T PROBATE A CONCERN ONLY FOR THOSE WITH LARGE ESTATES?

No. Although California has adopted simplified probate procedures (summary proceedings) that reduce costs and time delays for qualifying estates up to $100,000, the restrictions are complicated. Real estate of any significant value, for example, will often times disqualify the estate from summary proceedings. In addition, probate is always required when an individual dies without a will (intestate). Therefore everyone should have a will that is tailored to their individual situation.

It is advisable for every individual with Real Estate of more than $10,000 in value to consider a trust.

Question No. 4

IS JOINT OWNERSHIP A GOOD WAY TO AVOID PROBATE?

Sometimes jointly owned property, will pass from one owner to another without going through probate. However, when the surviving owner dies, or if both owners die simultaneously, the estate is probably headed for probate. The time delay of probate could seriously deteriorate the value the heirs would otherwise receive. Joint ownership on the other hand, is the most common method of holding title to an automobile.