Feeds:
Posts
Comments

The Probate Timeline

The following is a brief overview of the steps in the probate process and the correlating estimated time frame.  No two probate cases are the same. Each probate case is as unique and individual as a fingerprint. What follows below represents a sample timeline. Time frames will vary depending on many factors.

Activities in the Probate Process

Activity Timeframe
Prepare and File Petition for Probate. 1-2 months
Court hearing on the Petition for Probate 2-3 months
Orders for Probate & Letters of Administration/Testamentary
issued by the Court. Bond issued, if ordered
2-4 months
(if not contested)
Notice to Creditors filed 2-4 months
Notice to Department of Health Services Inventory & Appraisement 4-8 months
State and Federal Taxes are paid, if necessary 6-12 months
Reject or Allow Claims of Creditors 6-12 months
Possible Preliminary Distributions from Estate 6-12 months
Notice to Department of Health Services (if deceased received medical) 6-12 months
Notice to Franchise Tax Board (if heir is out of state) 6-12 months
Claim of Exemption (if assets transfer to a minor) 6-15 months
Receive Final Tax Letter from State and Federal, if appropriate 6-18 months
File Petition for Final Distribution and Accounting 8-16 months
Hearing on Petition for final Distribution and Accounting 8-16 months
Order Approving Final Distribution and Accounting 8-16 months
Distribution of Assets to Heirs 9-17 months
Final Discharge Order (indicates close of probate case) 9-18 months
Final Distribution of Funds 9-18 months
Advertisements

Probate Process

California Probate: An Overview

In California, probate isn’t a particularly onerous process, and there are several legal shortcuts that let many families avoid probate court altogether after a loved one dies. But probate in California can have one big drawback: extremely high attorney fees.

Will Probate Be Necessary?

Probate isn’t always necessary. If the deceased person owned assets in joint tenancy with someone else, or as survivorship community property with his or her spouse, or in a living trust, those assets won’t need to go through probate. The same is true for assets held in a revocable living trust and accounts for which a payable-on-death beneficiary has been named. (For a rundown of common probate-avoidance techniques, see our articles on “How to Avoid Probate.”)

Assets inherited by the surviving spouse or registered domestic partner can also be transferred with a streamlined procedure, using a document called a Spousal (or Domestic Partner) Property Petition. The probate court is involved, but the process is simple and quick. There is no limit on the value of property that can be transferred this way.

Other assets may not need to go through probate, either. If the total value of the probate estate (the assets that can’t be transferred to inheritors in one of those other ways) is small enough, probate won’t be necessary. Currently, the cap is $150,000. Inheritors can claim the assets with a simple sworn statement (affidavit) or can go through a streamlined summary probate process.

(For more information, see “Probate Shortcuts in California.”)

The Basic Probate Process

If probate is necessary, someone must come forward to start the process. If there’s a will, the executor named in the will should get the ball rolling. If there’s no will, or the person named to serve as executor isn’t available, then usually a family member asks the court to be appointed as the “administrator” of the estate. It’s the same job.

The executor’s job will probably last six months to a year. First, the executor files the will, along with a document called “Petition for Probate,” with the probate court in the county where the deceased person lived. There is a filing fee of about $400; some counties charge a bit more. Some other forms may need to be filed as well, and formal notices given to interested parties. The will, if there is one, must be shown to be valid; usually this is done by having the witnesses sign a sworn statement that’s submitted to the court. When everything is in order, the court issues “Letters Testamentary” or “Letters of Administration,” appointing an executor and granting that person authority over estate assets.

Once the executor has this authority, the process of gathering the deceased person’s assets can begin. It’s also the time for the executor to get organized, set up a filing system so that benefits and bills aren’t overlooked, apply for a taxpayer ID number for the estate, and open an estate bank account. The executor will need to compile, and file with the court, an inventory and appraisal of all probate property.

If all this sounds overwhelming, remember that it doesn’t all have to be done at once. It does involve a lot of paperwork (and usually, phone calls), but most well-organized and conscientious people can handle it. And the executor can always get help, from family members or from an attorney who understands the process and can serve as a guide.

Most probates in California are handled under the state’s Independent Administration of Estates Act, which lets the executor take care of most matters without having to get permission from the probate court. (Cal. Probate Code § 10400 and following.) The executor can usually sell estate property, pay taxes, and approve or reject claims from creditors without court supervision. Certain other acts—for example, selling real estate—require court approval.

During the probate, it’s the executor’s job to keep all assets safe. For example, a house must be insured and maintained; heirlooms must be safeguarded from theft or damage. The executor is also responsible for filing tax returns for the deceased person and for the estate.

In California, creditors have four months to come forward with their claims. Many estates don’t receive any formal claims from creditors; instead, the executor simply pays outstanding bills (for expenses of the final illness, for example). If there isn’t enough money to pay valid claims, however, state law sets out the order in which claims are to be paid from estate assets.

Finally, when all bills and taxes have been paid, the executor asks the court to close the estate. That’s when the executor can distribute all the estate assets to the people who inherit them.

Probate Attorney Fees in California

In most states, lawyers charge by the hour or collect a flat fee for probate work. Not so in California. It’s one of only a few states that let lawyers charge a “statutory fee”—an amount that is a percentage of the value of the assets that go through probate. The percentages are set out in state statutes. (Cal. Probate Code §§ 10810, 10811.)

Here are the current rates:

  • 4% of the first $100,000 of the gross value of the probate estate
  • 3% of the next $100,000
  • 2% of the next $800,000
  • 1% of the next $9 million
  • .5% of the next $15 million

Losing a loved one is a sad and difficult time for family, relatives, and friends. In addition, those left behind must often figure out how to transfer or inherit property from the person who has died.

To do this, you must usually go to court. And dealing with the courts and the property of someone who has died is very complicated. Sometimes, however, family or relatives may be able to transfer property from someone who has died without going to court. But it is not always easy to tell whether you need to go to court or qualify to use a different procedure.

This section will give you some general information to help you understand what your choices may be, but we still encourage you to talk to a lawyer to get specific answers about your situation. You can usually pay the lawyer’s fees from the property in the case.

What Is Probate?

Probate means that there is a court case that deals with:

• Transferring the property of someone who has died to the heirs or beneficiaries;
• Deciding if a will is valid; and
• Taking care of the financial responsibilities of the person who died.

In a probate case, an executor (if there is a will) or an administrator (if there is no will) is appointed by the court as personal representative to collect the assets, pay the debts and expenses, and then distribute the remainder of the estate to the beneficiaries (those who have the legal right to inherit), all under the supervision of the court. The entire case can take between 9 months to 1 ½ years, maybe even longer.

Once you’ve made the decision to apply for a Reverse Mortgage, you should prepare yourself by fully understanding what a Reverse Mortgage entails and how the process works.

Seniors aged 62 and older are entitled to mortgage their home under a federally-insured Home Equity Conversion Mortgage plan. This HECM mortgage, also called a “Reverse Mortgage,” allows the borrower to convert their home’s equity into a tax-free payment while they retain ownership of their home. The loan is repaid when the borrower no longer lives in the home, at which point the ownership of the house reverts to the lending institution. The lending institution then sells the property and recoups funds. Even if the value of the house declines, the borrower is not liable for the difference between the value of the loan that he received and the value of the house at the time that the bank takes possession.

Draw Options

The Federal Housing Authoritycaps the HECM maximum lending limit at $625,500. Reverse Mortgage borrowers have their choice of draw options. These options include taking the money as a lump sum cash payment, obtaining the funds as a line of credit or signing up to receive monthly payments. It is also possible combine these three alternatives when signing up for the preferred draw option. Borrowers should be aware that the monthly payment alternative offers varying monthly sums, with higher monthly sums available for older seniors. For this reason, Reverse Mortgage advisors suggest that seniors try to wait a few years beyond age 62 before they apply for a Reverse Mortgage.

Each individual borrower should consider his or her financial reasons for taking out a HECM loan when deciding on the method of payment. Many financial counselors suggest that seniors use a Reverse Mortgage to pay off a significant credit card debt, thus saving the credit card interest charges. In such a case, the borrowers will want a full or partial lump sum payment. In other cases, seniors who are having difficulties meeting monthly expenses on their retirement budgets will want to consider a line of credit or the monthly payment option.

Responsibilities

As part of the Reverse Mortgage contract, borrowers agree to continue the regular property tax payments on their home and maintain the home’s upkeep. In addition, borrowers are liable for the loan’s processingfees and must pay the loan’s interest costs. Lending institutions allow Reverse Mortgage borrowers to pay off these fees by subtracting them from the loan’s total payment.

Moving from the world of employment and a steady paycheck to a reality of pensions, Social Security and Medicaid can come as a shock to retirees who must contend with reduced income and new financial actualities. Financial advisers suggest that senior citizensinvestigate their fiscal status carefully before making any drastic economic changes or decisions.

There are a number of money management options that seniors should review in order to help them manage their finances more efficiently. Analysts remind retired individuals that not all suggested alternatives are applicable to every situation but seniors should carefully review each proposal to ascertain those which apply to their particular circumstances.

Credit Cards
Seniors should make it a practice to pay off their credit cards at the end of each month. This practice will save the credit card owner the costs associated with the credit cards’ high interest rates which increase the debt. With reduced income, seniors are at a greater risk of getting into a high-interest form of debt when they can’t pay off their cards at the end of each month.

Annuities

Annuities provide limited tax deferments and death benefits but the money is often locked in, unavailable to investors who may need the cash to take care of emergencies or other unexpected expenses. This is a major drawback, especially for seniors who may invest in annuities without fully understanding the implications of keeping their savings inaccessible for several years.

Life Insurance
Retirees should carefully review the cost of a life insurance policy verses the value of the policy. Seniors should investigate the cash surrender value of a life insurance policy versus the cost of the annual premium payments before signing on for such a policy.

Reverse Mortgages

Home Equity Conversion Mortgages (Reverse Mortgages) can offer real cash relief for retirees who want or need a monthly income or a lump sum payout. The Federal Housing Administration (FHA) – insured product offers seniors aged 62 and over assured alternative sources of income based on the equity in their home. Payment is not due until the borrower no longer lives in the house. The Department of Housing and Urban Development (HUD) regulates the industry and provides resources which ensure that potential borrowers have access to legitimate lending institutions for the HECM loan. HUDrequires that potential borrowers undergo counselingwith an approved HECM counselor before a lending institution can grant the Reverse Mortgage loan.

Did you know that people who work with a financial professional fare better in retirement than those who don’t?
Recent surveys and studies indicate:

  • People who work with a financial professional have a median retirement asset value of $78,000
  • People who don’t work with a financial professional have a median retirement asset value of $28,000
  • 40% of people who do not work with a financial professional say they will need to work in retirement.
  • Only 29% of people who do work with a financial professional say they will need to work in retirement.

In addition, the study also found that half of all women who work with a financial professional generally feel more empowered and financially secure. These women also tend to feel more optimistic about their financial futures and are more apt to teach their children about money.

Why do you need a financial professional?

Do any of these statements resonate with you?

  • I’m confused about conflicting financial guidance
  • I’m anticipating a life change that will affect my finances
  • I’m hoping for a better financial performance from my investments, yet I’m afraid the financial risks
  • I’m unprepared to leave behind my legacy

If one or more of the above statements apply to your situation, you may benefit from the services of a financial professional.
So, why aren’t you working with a financial professional?

Among the most common reasons people don’t work with a financial professional are:

* I’ve never considered it
* I don’t have enough money
* I don’t trust them
* I’m embarrassed about my financial situation
* I don’t know enough about finances

Do any of these responses sound familiar? As you can see, you are not alone when it comes to the reasons why you may not be working with a financial professional.
Find out if working with a financial professional is for you.

There is no time like the present to work towards a better financial future. Working with a financial professional now can help you build a better financial future.

email: Rick Curtis

Inheritance advances work well for both the borrower and the investor.


Heir advances – Easy Qualify

  1. Heirs of decedent’s estates can obtain a cash advance on their inheritance now and repay the obligation when the probate closes.
  2. Heirs can expect to get about a quarter to a third of their net inheritance early. Heir advances typically require 5-10 working days to fund.
  3. The security doesn’t have to be real estate; it could be cash, stocks, or other liquid assets
  4. Advances must be paid at the time of close of probate or sooner.
  5. Advances are not loans; they are cash lump sums paid to you now, which is discounted from the amount that you repay.


What Kind of Financing Terms are Available?

The cost of this type of transaction service may be from a quarter to a half of the total amount advanced. There is no “interest rate” or monthly payments because this is not a loan

Heir Loans – Well-Qualified

  • · Heirs of decedent’s estates can use their inheritance in lieu of a cash down payment in order to borrow to purchase California real property from the probate estate.
  • · The maximum that you may borrow is about 75% of the current value of the property, less any existing mortgages, liens or creditor bills to the estate.
  • · This means that you will need to inherit at least 1/4 of the total estate or more, depending on the NET value of your inheritance.
  • · This will require coordinating the transfer of the property out of the estate into the borrower’s name (done in escrow) and typically requires at least some effort on the part of the Attorney and the cooperation of Executor or Administrator


What Kind of Financing Terms are Available?

The rates and terms available are comparable to bank rates for a given borrower’s credit and income. Additional fees may be charged to coordinate the Attorney and Administrator efforts, sale, transfer, escrow, title insurance company and lender requirements.

So, what can you do with financing? Here are just a few examples:

1. Pay personal debts

2. Provide quick funds for emergencies

3. Stop foreclosure

4. Pay delinquent taxes

5. Provide money for repairs

6. Get cash for future living expenses

7. Pay for education costs

8. Pay for settlements and fund other legal actions

If You Are the Beneficiary of a Trust

1. Beneficiaries can obtain a cash advance on their inheritance now and repay the obligation when the trust is distributed (which must be within 3 years)

2. Beneficiaries can expect to get about a quarter to a third of their net inheritance early. Trust advances typically require 5-10 working days to fund.

3. The security doesn’t have to be real estate; it could be cash, stocks, or other liquid assets

4. Advances are not loans; they are cash lump sums paid to you now, which is discounted from the amount that you repay.

What Kind of Financing Terms are Available?

The cost of this type of transaction service may be from a quarter to a half of the total amount advanced. There is no “interest rate” or monthly payments because this is not a loan

Beneficiary loans

  • Beneficiaries of trusts can use their inheritance in lieu of a cash down payment in order to borrow to purchase California real property from the trust.
  • The maximum that you may borrow is about 75% of the current value of the property, less any existing mortgages, liens or creditor bills to the estate.
  • This means that you will need to inherit at least 1/4 of the total trust or more, depending on the NET value of your inheritance.What Kind of Financing Terms are Available?The rates and terms available are comparable to bank rates for a given borrower’s credit and income. Additional fees may be charged to coordinate the Attorney and Trustee efforts, sale, transfer, escrow, title insurance company and lender requirements.So, what can you do with financing? Here are just a few examples:1. Pay personal debts

    2. Provide quick funds for emergencies

    3. Stop foreclosure

    4. Pay delinquent taxes

    5. Provide money for repairs

    6. Get cash for future living expenses

    7. Pay for education costs
    8. Pay settlements and fund other legal actions

    I am a non Heir Third Party Borrower

    If you are related to one or more heirs of a probate estate which owns California real property, and wish to “step into their shoes” it’s sometimes possible to have the heir(s) or beneficiary assign their interests. This type of transaction, while more complicated, is possible with a well-qualified borrower, who can finance up to 95% of the purchase price.

    If you have no relationship to any of the estate heir(s) however you are prepared to make down payment and obtain a loan to purchase California real property, financing is possible with a well-qualified borrower, who can finance up to 95% of the purchase price.

    It is very important that you be informed about all the factors involved. Register below and include a scenario of your current situation in the comments section and any other information that you think may be important, and we will contact you with 24-48 hours.

  • This will require coordinating the transfer of the property out of the trust into the borrower’s name (done in escrow) and typically requires at least some effort on the part of the Attorney and the cooperation of Trustee or Successor Trust
  • No Credit Check or Job History Required For Inheritance Advance
  • No Hidden Fees, or Transaction Fees
  • No Interest Payments or Monthly Charges

email: Rick Curtis