Estate Planning and Probate
What is Probate?
How Does Probate Affect a Last Will or Living Trust?
Probate is a court supervised procedure by which the court ensures that the assets governed by a Last Will, also known as Last Will and Testament, are valued properly, the debts of your estate are paid off, and the remaining assets are properly distributed to the persons named in your Last Will.
Main Disadvantages of Probate:
Legal and executor fees and other costs must be paid from your estate before anything can go to your heirs. The costs are usually estimated at 1-5% of the gross value of an estate (before debts are paid).
Often 1-2 years or longer, depending on your state. During this time, assets are usually frozen and nothing can be distributed or sold without the courts approval. If your family needs money to live, they may have to ask the court for a living allowance, which the court may or may not approve.
» Lack of Privacy
Probate files are open to the public, so anyone (including a business competitor) can see what you owned and whom you owed. This knowledge can also invite disgruntled heirs to contest your Last Will.
» You or Your Family Loses Control
The probate process controls, and it can be very frustrating for your family to have to pay for the court to tell them who gets what money and when. This frustration very often leads to family feuds, disputes, and family members may even choose to contest the Last Will.
So as you can see, probate can be a very emotional and difficult process. If you ask anyone who has been through the probate process, they will likely tell you it is something you want to avoid at all costs, if possible.