Probate is defined as the procedure
by which an Executor or Administrator proceeds to admit
a Will to the jurisdiction of the court. This procedure
is designed to determine the "validity" of the will, and
if valid, to distribute the deceased's property in accordance
with the terms of the will. The term "probate" generally
includes all matters relating to the administration of estates.
Following are just a few of the drawbacks associated with
probate.
Lack Of Privacy Documents filed
with the Court are public information. They are available
for inspection to anyone who asks. In large estates which
require an accounting, your probate file will contain a
complete list of all assets which are to be distributed
by your Will - this includes business assets. This lack
of privacy may lead to problems among family members who
now know the plan of distribution and may promt a will contest
with respect to provisions they disagree with. Disinherited
relatives and creditors are notified and given time by the
court to contest the Will.
Time Consuming The probate of
an estate may take several months to several years to complete.
During that time family members may have to apply to the
court for an allowance.
Fragmentation - Real Estate If
you own real property in more than one state, probate rules
must be followed in each state in which real property is
located. The cost and time may be increased. REVOCABLE TRUST
A Revocable Trust is a legal device that allows you to maintain
complete control over your assets while AVOIDING PROBATE.
Because there is no probate of a Revocable Trust, your private
financial matters remain private, there are no probate costs,
no delays and loss of control, and no fragmentation of the
estate.
You Maintain Complete Control Over
Your Property In Trust The principle behind a Revocable
Trust is simple. When you establish a Revocable Trust, you
transfer all your property into the Trust, and then name
yourself as trustee, or you can name you and your spouse
as co-trustees of the Trust. The trustees maintain COMPLETE
CONTROL over the property, the same control you had before
your property was placed in trust. You can buy, sell, borrow,
pledge, or collateralize the trust property. You can even
discontinue the Trust if you desire, hence the term "Revocable"
Trust.
Transferring Property Into The Revocable
Trust The transfer of title to property into the Revocable
Trust is a relatively simple matter. Anywhere you have assets,
you will get help in transferring your property into the
Trust. Your financial planner, bank, insurance agent, investment
counselor, or securities investor, etc., will provide you
with assistance needed to transfer your property into your
Revocable Trust. This is generally accomplished by the filing
of a simple form requesting a change of ownership from you
personally, to your trust. You may need the assistance of
an attorney to transfer real estate, but this cost is minimal
and involves nothing more than the drafing and then filing
of a deed with your local Registar of Deeds Office.
Complete Privacy Probate records
are public, your Revocable Trust documents are private.
A Revocable Trust will safeguard the privacy of your family
and your private financial matters.
Naming A Trustee Most people
name themselves and their spouse as the initial Trustees
of their Revocable Trust. This is usually true unless one
spouse is incapacitated to the point that he or she is not
able to manage your assets in the same way you do now.
Gifts To Religious And Charitable
Organizations Many people wish to give a portion or
sometimes all of their assets to a religious or charitable
organization in order to carry on the work of those organizations
that have given them comfort or peace of mind during their
lifetimes. This is easily accomplished with a Revocable
Trust.
