What Is Probate? The Basics of Probate
Before we dive deeper into the process of probate, it is first important to have at least a rudimentary knowledge about probate. This section will familiarize you with some key terms you’ll want to know before you fill out paperwork or appear before a probate court judge.
What Is Probate? Key Terms You Should Know
Here are six common terms that you may likely encounter as you go through the process of probate:
- Administrator: A person appointed by the court to act as a personal representative of the estate in the absence of a will
- Beneficiaries: Individuals who are entitled to inherit the assets of the decedent (legal heirs)
- Decedent: The person who passed away
- Executor: A person named in the will who is responsible for managing the estate. The executor is expected to act in the best interest of the decedent.
- Intestate: A situation where a person dies without a will
- Will: A legal document that outlines a person’s wishes for their assets
When Is Probate Necessary?
Probate is a requirement when a person dies without a will or the person fails to properly plan their estate. There is no way you can simplify or even avoid the probate process in cases like these. However, there are certain assets that are not subject to probate at all. Some items that can avoid probate (non-probate assets) include:
- Retirement accounts
- Beneficiary designations
- Assets under the revocable living trust
- A life insurance policy
- A community property
Other than the lack of an estate plan, there’s another situation where probate could be necessary. This is when a deceased person happens to have no immediate family members or designated beneficiaries of their real property. In cases like this, the court, in the absence of a living trust, has to evaluate how the decedent’s assets get distributed among the potential heirs and rightful beneficiaries.
During the distribution of assets to beneficiaries, the contents of the will (if it exists) must be followed. This is to ensure that only the rightful beneficiaries are granted their fair share of the estate assets. However, if the property was under joint tenancy, community property laws are applied. This means that since the estate was managed by joint property owners, the other owner will automatically inherit the property. This, therefore, prevents the property from going through probate.
What Is Probate in Action? The Probate Process
There are several forms and legal steps you need to take to start the probate process. This may also vary depending on some factors such as the size of the real property.
For instance, if a person’s cumulative assets are less than $166,250, the deceased person’s assets can be exempted from complex probate proceedings common to larger estates. These smaller estates can instead go through a simpler and faster process. Aside from that, the nuances of the probate process depend on whether there is a will or not.
Regardless of the presence of a will, you may want to read a general article as to how the probate process starts in California. Below is a short summary of how probate works with and without a will:
Probate with a Will
Before starting the probate procedure, the first step is to have the will authenticated. A probate judge usually takes care of this through a court hearing. This step also paves way for other concerned parties to raise their objections before the formal legal proceeding for the probate estate starts. If any issues hinder the property from probate, they are handled at this stage.
When the last will and letters testamentary (letters of administration) are successfully verified, you can proceed to these four steps:
Appointing an Estate Representative
Assuming that the deceased person has a will, an estate personal representative serves as the executor of the will as stipulated in the Probate Code 8402. But not everyone can legally serve as the executor. Under the Probate Code, an estate representative should be:
- at least 18 years old
- of competent and sound mind
- not subject to the conservatorship of the estate
Aside from the three basic qualifications, non-US residents and surviving business partners of the deceased person cannot serve as estate representatives unless otherwise stated in the will.
Filing a Petition
After finalizing who the personal representative is, the official probate process begins. It starts with filing a petition for probate. In this step, it is important to accomplish and prepare the following forms:
- Petition for Probate (Form DE-111)
- Original will from the deceased person
- Notice of Petition to Administer the Estate (Form DE-121)
- Duties and Liabilities for Personal Representative (Form DE-147)
- Order to Probate (Form DE-140)
- Letters (DE-150)
Should a need arise to prove a will, you must also file a Proof of Holographic Instrument (Form DE-135) as well as a Proof of Subscribing Witness (Form DE-131) and provide the relevant death certificate. If this seems like a lot of paperwork, don’t worry; A People’s Choice is a legal document preparation service, and we can help you prepare all of this and more.
Filing a Probate Bond
Also referred to as a fiduciary bond, a probate bond is a California state court bond that is issued on the personal representative of the estate. It ensures that the executor or administrator of the estate will distribute the estate assets per the wishes of the deceased person. If there is a will, the executor has to follow its directions regarding the distribution of assets to heirs. Assets can include anything from real estate to individual retirement accounts to simple personal property.
A probate bond also protects the assets (sole ownership property) of a person who is still alive but is incapacitated. This is accomplished through a living trust that manages their estate.
The cost of a probate bond depends on the cumulative amount of the estate. It may range from a rate of 0.5% to 0.8% of the total amount.
Attending the Hearing
Once you have completed the previous steps, it is time to go through a probate hearing. This is where the judge decides whether all the required action items were fulfilled and whether the personal representative rightfully performed their duties. It is also where the judge issues the final order to close the estate and distribute the assets to the beneficiaries.
Probate without a Will
When a person dies without a will, it is referred to as intestate. This may also refer to a situation where there is a presence of a will, but the will is proven invalid. The treatment for this is to distribute the assets per the state laws for intestate succession. The state laws will determine how assets from intestate estates are distributed to the rightful heirs.
Does Probate Require a Probate Lawyer?
To answer the question simply, no. You are not required to hire a probate lawyer for the probate process to proceed.
Much of probate is allocated to the filing of forms. Instead of hiring a lawyer, you can seek assistance from a registered legal document assistant service to save you the hassle of doing all the paperwork on your own. Not only will this save you time; it can save you from fees incurred if paperwork is filled out incorrectly, not to mention exorbitant lawyer fees.
However, there are some cases where hiring a lawyer is the best option for you. This is especially true for estates with complicated ownership, such as businesses and real estate properties. A probate lawyer can, for example, provide due diligence concerning filing estate tax and adhering to laws relating to federal estate taxes for the entire estate.
It is highly recommended for you to seek the help of a lawyer if you are dealing with a very complex estate with several bickering beneficiaries.
To help you decide whether you should hire a probate lawyer or not, here are a few questions you should ask yourself:
- Are there outstanding debts? If there are, are the decedent’s assets enough to pay those?
- Does the decedent own real properties and businesses? If yes, do you know exactly what the type of ownership is?
- Are there disputes regarding the validity of the will as well as the beneficiaries of the estate?
- Are there complicated issues concerning estate taxes?
If you happen to answer yes to some of these questions, then it may be in your best interest to hire a probate lawyer. While it will be expensive, it can help you alleviate the possible complications of the probate process.
Should Probate Be Avoided?
We understand if you would like to avoid probate. After all, it can consume a lot of time and money. The entire process may take up an average of nine months, and it may take even longer depending on several factors. Some of the costs incurred during probate include:
- Filing fees
- Creditor notice fees
- Attorney fees
Aside from being time-consuming, probate is also expensive. Filing probate costs $435 in California. Moreover, if you choose to hire a probate lawyer, you will also have the obligation to pay a statutory probate fee. This is a certain percentage of the total value of the estate. Apart from these two expenses, the total cost of your probate is still subject to increase should complications arise.
Perhaps you are wondering now how you can avoid such probate costs! While there are probate alternatives out there, there are cases where probate administration simply cannot be avoided.
Getting the Right Help with Probate
It is undeniable that probate is complicated, but you do not have to do this on your own. While the first person you can think of asking for help is a probate attorney, do remember that a probate lawyer is only really needed in the special cases mentioned above. Plus, hiring one can be expensive since they receive statutory fees as compensation.
Since much of the probate revolves around doing paperwork, you may keep in mind that a legal document assistant can be your inexpensive yet effective alternative. Here at A People’s Choice, we can save you from the hassle of preparing all the forms you need for the probate process. If you are interested in our services, or even if you just have further questions and clarifications, do not hesitate to contact us today!