Readers of this blog have heard of the probate process because it is part of the estate administration process. And, this post will give an overview and why it should be avoided whenever possible in the 81 corridor.
First, the term, “probate” refers to the judicial procedure where one’s estate is closed out, i.e., debts and beneficiaries paid so that all estate assets are no longer in the deceased name. This is a judicial process that is presided over by a probate judge, but the actual estate administration is done by the executor, if one is named in a will, or an administrator named by the Shenandoah Valley probate judge.
First the executor must file the will with the probate court. If one there is no will, then a family member will need to ask the probate court to appoint an administrator to wrap up their loved one’s affairs. Both the executor and administrator can take a reasonable fee to accomplish this goal. Primarily, their job will be to collect all the assets and make an accounting of all outstanding debts. Then, they must payoff those debts utilizing the estate assets, and everything left over is given to the beneficiaries that are outlined in the will.
One of the primary reasons that probate should be avoided or mitigated is the fact that it is a litigious process. This means lawyers and their fees, court fees and possibly, expert fees that are needed to value assets or make expert opinions on documents, like signature validity. It can get expensive quickly, and can sometimes take years to complete.
Probate without a will
Probate without can be even more expensive because everyone will, essentially, have to fight everyone else, including debtors. And, as with all Harrisonburg legal battles where all parties are fighting each other, the fees grow quickly.
Avoiding or mitigating probate
In most states, probate can be avoided through careful estate planning and the use of trusts, joint accounts, and payable on death designations. For those accounts that are joint, the joint holder can simply liquidate and close the account when the co-owner passes. For payable on death accounts, the person that is designated gets the payout on the owner’s death, again, without the need for probate. Life insurance policies also exist out side the probate process. Though, with learned trust usage, one can move all assets out of the deceased name before death to ensure their estate has nothing of value worth litigating.