The probate courts provide crucial oversight during estate administration. The courts help ensure that heirs receive their inheritances when an individual dies without a will. They can also take action when the beneficiaries of an estate assert that the personal representative has embezzled or otherwise failed to fulfill their fiduciary duty.
Overall, the probate courts serve an important role in the protection of the legacies of deceased individuals and the rights of their heirs or beneficiaries. However, probate proceedings can be expensive. They also delay the transfer of wealth to beneficiaries or heirs. In some cases, assets are subject to liquidation to pay taxes or creditors.
Those establishing estate plans may want to avoid probate court entirely if possible or keep their most valuable assets out of court. For many adults, the homes they live in are their most valuable resources. The three strategies below can help people keep their homes out of their probate courts by preventing them from being formally treated as part of their estates.
Transfer on death deeds
A deed is a legal instrument that facilitates the transfer of real property ownership. Most deeds go directly to the county recorder’s office after their signing for immediate recording. However, testators planning their estates can establish transfer on death deeds that remain in storage for years until they die. These documents arranged for a specific individual or multiple individuals to assume ownership of the property when the current owner passes.
Changing vesting while still alive
In scenarios where the testator already lives with the person they chose to inherit their home, they can change how they hold title while they are still alive. Those who establish joint tenancy with rights of survivorship through a deed can allow their interest in the property to pass directly to their roommate, child or romantic partner without the involvement of the probate courts.
Transferring the home to a trust
Trusts are useful tools for the protection of real property holdings. The assets used to fund a trust no longer belong directly to the testator and therefore do not become part of their estate when they die. Trusts can help protect homes from estate recovery efforts and can also diminish the total value of the estate to limit the risk of taxes.
There may be other viable solutions available depending on the unique circumstances of a testator establishing their estate plan. Reviewing an inventory of assets with a skilled legal team can be a good starting place for those who want to protect their resources by keeping them out of probate court.