Hi everybody, my name is Miranda Dressler and I’m an attorney at the Law Offices of Bridget Mackay in Petaluma, California. And today I want to talk to you a little bit about probate. What it is and why people want to avoid it.
So most of the time when I have clients come into my office to get a trust done, one of their main concerns and one of the main reasons that they think that they’re getting a trust done is to avoid probate when they pass away. But a lot of people have misconceptions about what probate is. And why sometimes it’s necessary and why it should be avoided. So, I’m going to talk a little bit about that today.
Probate is a court process that occurs when somebody passes away. And the main purpose of probate is to change title to assets. From the name of the person who’s passed away and into the name of the rightful beneficiaries or the people who are inheriting those assets from the deceased person.
And so, in the probate process the court is going to be responsible for making sure several things get done. If there are any disputes among beneficiaries or anybody else, the court will resolve those disputes. The court will make sure that any creditors of the deceased person get paid. All the assets of the estate will be inventoried, and they will be appraised. And then ultimately, the court will distribute those assets and change title into the names of the beneficiaries.
So, there are two main reasons why someone would want to avoid having their estate go through this process when they pass away. And the two main reasons are because it’s very expensive and it’s very time consuming. So, in California the two main expenses associated with the probate are the attorney’s fees and the executor fees. These fees are set by statute – meaning you can’t negotiate with the attorney about them. And they’re going to be based on a percentage of the total value of the assets in the estate. And so, what that ends up being is, in general, the attorney and executor fees are going to cost between three to five percent of the total value of the assets of the estate.
And so, for example let’s say that there’s an estate worth one million dollars that’s going through probate. The attorneys and executor fees alone are going to be about $50,000. You know, that’s a big chunk. And there’s other fees associated with the probate as well like publication fees, bond fees, appraisal fees. So, it can get very expensive.
And the other main reason to avoid probate like I said it’s very time consuming. In California, a probate generally takes about 18 months to complete. And that’s if everything goes smoothly. If there are issues or disputes, probates can be known to take years. So that is a little bit about probate, why it should be avoided.
If you have any further questions, please contact an experienced estate planning attorney in your area. Thank you.