The first home that I bought with my husband was a very difficult learning experience. We purchased the house as-is and worked directly with the owners instead of using a real estate agent. About a year later, we learned why the former owner sold the house for so much under market price and why they didn't want to use a real estate agent to sell it. Our blog outlines the many mistakes that can be made if you purchase a home without a real estate agent or attorney working with you. Hopefully, our mistakes will help you learn what not to do.
No one wants to think about dying. However, if you have a lot of money and property, it is something that you need to give some thought to for the sake of your loved ones. Many families have been torn apart by vague wills and even by the deceased having no will at all. Even if you do have a will, your loved ones will have to go through probate before they can collect what they have inherited. Probate is the legal process where a judge determines whether or not a will is valid. It can take anywhere from a few weeks (for uncontested wills) to years (if the will is contested). That is why many people are starting to look for ways their loved ones can avoid probate. Here are three ways you can do just that.
1. Pay-on-death accounts.
If you want to make sure your heir(s) get quick access to your bank accounts after you pass away, you can turn the account into a pay-on-death account. This will allow you to name a beneficiary who will receive the balance left in the account after you have passed away. All the beneficiary has to do is present your death certificate at the bank and show them proper identification to receive the funds.
Be aware that a surviving spouse may have a claim on your bank account, even if you do have a beneficiary listed on it. It will depend on how the law in your state views "community property" in a marriage. Also, if your bank account is a joint account, the beneficiary will only be able to collect the funds from the account by presenting death certificates for each account holder.
2. Revocable living trusts.
Another way you can help your loved ones avoid probate after you pass away is to put your assets into a revocable living trust. You will have control over the trust while you are alive because you will be the trustmaker, trustee, and the beneficiary.
When you create the trust, you will designate a successor trustee to take over the trust after you have passed away. Any assets in the trust will avoid probate and the new trustee will be able to pay off any of your outstanding debts and distribute the rest of the money to the ultimate beneficiaries named in your trust.
3. Joint ownership of property.
A common way for a spouse to immediately gain ownership of real estate property after your death is to have joint ownership of the property. Whether you have joint tenancy or tenancy by the entirety, the property will not be held up in probate court and your spouse will own the property.
Some states use community property laws, which state that any property that is gained after the marriage begins belongs to both spouses equally. That means if your spouse dies, you would still retain ownership of the property and it would not be included in probate proceedings.
Of course, it is also possible for unmarried people to have joint tenancy agreements. For instance, if you have allowed your best friend to live in your home and you created a joint tenancy agreement with them, then they have a legal right to continue living there after you have passed away. It doesn't matter what your will says about who owns the property after you die; your heir will have to continue allowing your friend to live in the home for the life of the joint tenancy agreement or your friend chooses to leave.
For additional advice regarding wills and probate, contact a probate law office such as Leon J Teichner & Associates, P.C.Share
10 July 2015