What is Probate & Why You Want to Avoid It?

What is Probate?

A common goal of estate planning is to avoid probate.  But what exactly is probate?  Probate is a court-supervised process for gathering a decedent’s assets, paying the decedent’s debts, and distributing the remaining balance to the decedent’s beneficiaries.

The process ultimately requires proving a will to be valid, obtaining a court order and letters testamentary which allow an executor to (amongst other things) transfer a decedent’s assets and wrap up their accounts, and taking care of other responsibilities of the decedent.

Why Would I Want to Avoid Probate?

It is desirable to avoid probate for multiple reasons.  Once a probate is filed with the court, your estate becomes public record, and the public is also notified of the court hearing in a required newspaper publication.  Not only does a family lose privacy in this instance, but it could increase the likelihood of an unhappy heir contesting the estate.

At least four percent of the value of your assets will be paid by your estate in fees, and possibly double that if an attorney is needed to assist with the probate (which is often).  The fees involved in the process are set by statute, and therefore cannot be avoided if a probate is required.  This ultimately results in your beneficiary’s inheritance being significantly reduced because of the fees that the estate had to pay during the probate process.

Furthermore, in California it is a lengthy court process that can average about 18 months.  In San Diego specifically, the process may face even more delay due to the budget cuts our courts have recently faced (see Changes at the San Diego Superior Court posted on August 16, 2012).

How Can I Avoid Probate?

A properly drafted and funded trust can avoid probate.  By titling assets into the name of the trust, the trustee can then transfer those assets without court involvement.  The process may also not be necessary if a decedent’s estate has minimal assets at the time of death.  Have an attorney assess your estate to determine whether your estate would or would not be subject to this court process.
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Christine Ellingsen is a Northern California native now practicing law as an estate planning attorney in Carmel Valley San Diego at the Barger Law Group, APC.  She spent a year in New York working in the business sector before moving to Southern California to attend law school at the University of San Diego.  She is happy to have started her law career in San Diego and to now call Encinitas home, where she keeps busy between exploring Coastal North County and training her new puppy.