There are several things you can do now while you are alive to prevent your loved ones from having to probate. This is especially important if you are married and your spouse will be your sole beneficiary. This is not to say you should not have a will. Everyone should have a will just in case some asset comes up that we didn’t plan for properly or in the event you die accidentally and litigation ensues.
- Name Beneficiaries – you can name your beneficiary on various types of accounts, including bank accounts, life insurance, retirement accounts, and investment accounts. Review these accounts every few years to ensure they have the beneficiary of your choosing.
- Joint Tenants with Right of Survivorship – when you purchase a house ask the title company have the deed read “joint with right of survivorship” which transfers the house to your spouse immediately upon death. If you already own your house, you and your spouse can execute a new deed that makes the ownership “joint with right of survivorship” so that the house is automatically transferred upon death.
- Living Trust – while this may seem to be the most straight forward approach, only an attorney can tell you if you really need one. Many people get living trusts and never properly fund them so probate turns out to be necessary anyways. Also a living trust does not protect you from liability as many people think it does.
- Transfer on Death Deed – this document is a new statutory document created by the Texas Legislator to help protect your real estate. While this document is a deed, it is not a traditional deed, in that it does not immediately transfer ownership to your beneficiary but allows you to instead retain all ownership rights. Upon your death the real estate automatically transfers ownership to your named beneficiaries. These types of deeds are used mostly by people wanting to transfer their home to their children or grandchildren upon their death.
For more ideas and ways to plan so your family can avoid probate court contact your attorney! Remember that “an ounce of prevention is worth a pound of cure”.
After losing their spouse, many people don’t contact an probate attorney because they believe that everything just goes to them immediately. But this way of thinking may cause more harm down the road. Nothing in life is absolute except death and taxes, so at least consult an attorney to make sure there is nothing you should do or to find out what your time limits are with regards to probate. Here are a few cases where waiting caused more problems:
- Jane Doe dies and her husband Don doesn’t probate her will. Four years pass, and then Don Doe dies. Since Jane’s will was not probated within the 4 year statutes the only alternative is to probate as “muniment of title” to clear title to the house or cars. In this case there is no formal probate of Jane’s estate which may create problems with certain asset at financial institutions and may force the beneficiaries to pay all debts prior to probating.
- Jane Doe dies and her will isn’t probated because her husband, Don Doe, doesn’t want to waste his money. Years later Don learns that there are assets in both of their names that need to be probated. Jane’s will can not be probated after 4 years because Don is the one at fault for not probating. Don goes to an attorney and finds out that since Jane had children from a prior marriage, they take her 1/2 instead of him.
- Sarah Jones dies and she does not have a will. Four years pass, and Mike Jones tries to sell their house. Just prior to closing on the house, Mike finds out that the house is still in both his and Sarah’s name. Mike contacts an attorney to probate and must wait more than 30 days to get the probate finalized, so he loses the sale on the house.
As you can see there are many different situations that warrant consulting an attorney to ensure probate is not necessary after the death of a loved one. While there are many different reasons that may take you into probate court, there are ways to avoid probate court such as:
When there is a will:
Muniment of Title – while this process requires you to file in probate court, you are not opening a formal administration so once the court signs an order you are done with the probate court. So if you find that all the deceased person’s unsecured debts are paid and you just need to transfer title to the assets, have your attorney probate the will as a “muniment of title” which transfers title only and does not open a formal estate.
When there is no will:
Affidavit of Heirship – when there is no will, there is an informal process of having an “affidavit of heirship” prepared by an attorney and filed in the county real property records. This is not a costly process and it will benefit the parties in the long run. Don’t try to do one yourself, as mistakes will end up costing more in the long run. Do this now rather than later because witnesses may die, move away, not remember, etc. This document will clear up title to property and vehicles so that the parties can move forward in life and not be held back when trying to sell such assets.
Determination of Heirship – This process is similar to the Affidavit of Heirship above, but it involves going to the probate court, having them appoint an attorney ad litem to verify the heirship information and signing an order on who the heirs are in an estate. This process may be required of certain financial institutions that do not want to rely upon a “Affidavit of Heirship” and who may want the Judge to make a formal finding.
Small Estate Affidavit – This process is for very small estates under $75,000.00 (not counting exempt assets) or when trying to transfer the decedent’s homestead to their spouse. The form is prepared and filed with the probate court. The judge will then approve the Small Estate Affidavit to allow the transfer of assets to occur. Keep in mind that this form will not transfer title to real property (other than the homestead), so if there is no spouse (so no homestead) or other rental real estate then this form won’t work.