Bills And Probate: A Helpful Guide

Blog

After a loved one has died, the property of the deceased goes through a legal process called probate. You may have heard of various methods for "avoiding" probate, but in most cases there will still be a need for probate. Many methods for keeping property out of probate exists, such as trusts, gifts and payable-on-death account designations. Taking advantage of these methods can reduce probate, but there will still likely be a need to file papers with the court.

If your loved one left a will, it must be probated. The amount of property included in the will can be managed by using revocable trusts and other methods. If your loved one died without a will, or "intestate", it is unlikely that the probate process can be avoided.

• Some assets are not subject to probate: life insurance, retirement assets, stocks and bonds, and bank or brokerage accounts that are jointly held or that have payable-on-death designation.
• Assets that could be included in probate: real estate and personal property such as automobiles, boats, recreational vehicles, tools, furniture, antiques, jewelry, etc.

One of the main functions of probate is to allow creditors a chance to make a claim against the estate. The notice to the creditors is normally published in a local newspaper for a designated period of time, usually once a week for several weeks. Creditors then have a specified period of time, which varies by state, to come forward with claims against the estate.

As a family member of the deceased, you may be aware of credit card bills, loans and other financial obligations, but you could be caught off-guard by some lesser known situations. For example, be on the look-out for the any loans that the deceased may have co-signed. If the other co-signer defaults on the loan, the estate could obligated to pay that debt.

Bills must be paid, however, and most cannot wait for probate. Bills should be divided up into two categories: administrative expenses and final bills.

• Administrative expenses are bills that need to be taken care of on a day-to-day basis, like mortgage payments, utilities, and property taxes.
• Final bills are credit card payments, personal loan payments, auto loan payments and taxes. These obligations will be "put on hold" until the will goes through probate.

As you can see, there is more to probate than simply the transferring of a decedent's property after death. While you can take steps to keep some property of out probate with the help of an attorney, you will still need to have an understanding of the other aspects of probate procedures.

Contact professionals like Davis & Mathis to learn more about probate administration.

Share

19 May 2015