How is a Will probated?
The following is a simplified outline of the general probate
process:
The original Will is filed with the Court.
The Executor named in the Will or Administrator is appointed.
Executors and Administrators are commonly referred to as
Personal Representatives.
The Personal Representative files a Petition for Probate of
the Estate.
For approximately nine months from the date of the Petition
for Probate, creditors of the Estate can file claims against the
Estate. This would include any prior creditors or judgment
holders, debts resulting from last illness, funeral expenses,
taxing authorities, etc.
During this time period, the Personal Representative has to
identify and collect assets of the Estate. To do this, the
Personal Representative finds all bank and security accounts,
debts owed to the Decedent, property owned by the Decedent, etc.
The Personal Representative also has to maintain the assets in
good condition. This consists of maintaining insurance coverage,
collecting rent, protecting assets from theft or damage, etc.
The Personal Representative may also liquidate assets such as
cars, real estate, etc. during this time.
When the nine-month claims period has expired, and when all
assets have been collected, real property sold, and assuming no
problems have presented themselves such as the Will being
contested, the Personal Representative then files a petition
with the probate court to allow a distribution of all remaining
assets to the beneficiaries/heirs, and files a detailed
accounting with the Court setting forth all monies received,
monies disbursed, how assets were invested, and the proposed
plan for distribution.
If the Court approves the plan, the Personal Representative
then divides the assets as instructed in the Will, or as
required by statute if no Will exists.
The minimum amount of time that the probate process can be
completed is approximately nine months, but it normally takes
longer. Reasons for delays can include (as example but not limited
to): Will contests, problems/difficulties encountered with the sale
of property, and/or failure to notify claimants within the original
nine-month claim period.
How does a Trust work?
Trusts are the process by which the grantor transfers legal
ownership to a person or institution (called the trustee) to manage
the property for the benefit of another person (called the
beneficiary).
Trusts create a fiduciary relationship between the trustee and the
beneficiary. The trustee must act solely in the best interests of
the beneficiary when dealing with the trust property. If a trustee
does not live up to this duty, the trustee is legally accountable to
the beneficiary for any damage to his or her interests. The grantor
may act as the trustee himself or herself, and retain ownership
instead of transferring the property. A grantor may also name
himself as one of the beneficiaries of the Trust.