When property is transferred when the owner dies, the legal process is known as probate. Probate laws have changed over time, but its purpose remains the same. People use a will to formalize their intentions to transfer their property at the time of death. Once the person dies, his property will be collected, outstanding debts will be paid off and the property is then distributed.
Currently, the probate process is supervised by the court and it is designed to prevent any altercation that could arise in the transfer of property from one person to another. Property that is subject to probate is owned by the person at death or who has written a probating will. The will describes the process by which a person will show the court that the person who died or decedent followed a legal formality when drafting the will. The main aspect about probate process is how to avoid the procedure itself.
The movement to avoid probate process is motivated by the desire to avoid fees charged during the process. There is a possibility of avoiding the probate process completely. However, do not try something that you are not familiar with. Common ways that are used to avoid probate include gifts, revocable trusts and joint ownership with right of survivorship. The probate system exists to help protect all parties involved in the process.
It is imperative to note that the probate process can be uncontested or contested. In most contested issues, the problems that arise are mainly from a disgruntled heir who is seeking a large share of the decedent’s property. In this context, the heir is trying to seek a larger share than the actual amount received.
Arguments often arise and the decedent was not in a sufficient mental capacity, or that the decedent was influenced at the time of writing the will or that the decedent did not follow the right channel during the drafting of the will. Most of the probated estates are usually uncontested. The basic process of probating a real estate include: collection of all probate property, paying all debts, taxes and claims owed by the estate, settling any dispute , collecting rights to income, dividends and distribution of the property to the heirs.
Normally, the decedent’s names a person or an executor to take over the management of the affairs of the estate upon his or her death. If the decedent failed to name the person who will execute the process, then the court is forced to appoint an administrator or a personal representative to help settle the debt.
The administrator will carry out all the basic probating process requirements. In essence, people may decide to leave the property to a person they wish and make the designation in the will. However, there are situations where depending on the relationship of the decedent and the laws of the state they reside in, the decedent wishes may be overridden by the court. An example in most states in the United States of America, the spouse is entitled to a certain amount of property. The creditors could have a claim on the estate property as well.
Each jurisdiction has its own rules and regulations about the probate process and it is imperative to note that a prescription is given on the length an estate must be open to creditors and adequate time given during which they can claim the estate. There is complexity which arises when the estate is bigger and there are other components involved in it. The probate process has a number of costs that must be put into consideration before you begin the process. The costs include court costs, attorney fees, and fees of the personal representative.
As described, the probate process begins with the filing of a petition with a probate court or relevant court of the land. Once the petitions is filed, a notice of the court hearing is provided to all decedent’s heirs and beneficiaries. If a beneficiary or heir has an objection to the petition, then they will present the objection to court of law. Generally, the notice of hearing is published and this is to notify others that the proceeding has begun and anyone objecting should do so in a court of law.
The personal representative or the chosen heir gives a written notice to all creditors of the estate based on the law of the state. Any creditor who wishes to claim assets of the estate must claim the asset before the lapse of the set time. The time varies from one state to another and it is important that you look at the laws and regulations in your state to make a sound decision. All the inventory of the decedent’s probate property including bonds, stocks, real property and business assets are taken into consideration. The court may appoint an appraiser.
In essence, this covers all expenses including funeral expenses, taxes and debts that must be paid from the estate. The personal representative should determine the creditor’s claims are legitimate and pay them on time. In some cases, the personal representative is allowed to sell the estate assets to satisfy decedent’s obligations.
After the period by which creditors file claims against the estate, all approved bills are cleared and the personnel representing the real estate can transfer the remaining of the property to the rightful heirs. This is after the court has verified all the information to be true.
If there is no heir to the probate property, then the representative will divide the property as per intestate succession laws. In a situation where the will calls for creation of a trust to benefit a spouse or a minor, the money is then transferred to a trustee. All the transfer process should be in tandem with the state laws and regulations. Unless the beneficiaries waive the requirement, the petition may include an account of how assets are managed during the probate process.