Losing a loved one is an overwhelming and difficult situation for you, your family, friends, and relatives to handle. Often times, the decedent leaves behind personal belongings, possessions or assets (called an estate) to be transferred to heirs or other beneficiaries. This legal process that the court oversees to distribute the estate accordingly is called probate. This process can be quite lengthy, troublesome and expensive. That is why it is best to avoid probate as much as possible. Luckily, not every estate needs to go through probate.
If you are currently in the process of settling an estate, then you must first determine which procedure to follow. To do this, you must know how money is involved, the type of property involved (real estate, cars, stocks, etc..), and who is claiming the property (beneficiaries, heirs, joint tenants, etc)? Depending on those three factors will determine whether it has to go through probate, can transfer via the simplified probate procedures, or transfer as a non-probate asset.
What Are Some Non-Probate Assets That Avoid Probate?
By default, the assets listed below do not need to go through probate. These assets have different procedures of actually transferring ownership from the decedent to the heir. So be sure to check with your state laws or an attorney to know the procedures in your state.
- Real Estate Held In Living Trusts Transfer Without Probate
- Property Can Be Transferred With A Transfer-On-Death Deed
- A House Owned By Two Or More People Hold Title As Joint Tenants With Rights of Survivorship
- Assets That Have A Named Beneficiary (Life Insurance Policy, IRA account, 401k account etc..)
What Are The Simplified Probate Procedures?
In California when you have real (houses, condominiums etc..) or personal property (manufactured homes, stocks, vehicles etc..) that do not apply as one of the non-probate assets listed above, there are three simplified procedures to transfer assets to the heirs without going through probate. Each procedure has its own restrictions based on the amount of money involved, which assets apply, or the person who is receiving the asset; which we will mention below.
- For Real And Personal Property Owned Not Exceeding $166,250 In Gross Value: You can file a petition, called the Petition To Determine Succession To Real Property, to transfer any real estate and personal property located in California that has a gross value of less than $166,250. If the decedent only has personal property, you can use the petition described above or you can also use an affidavit (that must comply with the requirements said in Probate Code Section 13100) to transfer ownership.
- For Real Property Valued Under $55,425: To use this procedure, the estate cannot have real property valued at more than $55,425. To transfer title, the decedent’s successors file an Affidavit RE: Real Property Of Small Value at the Superior Court of the county and the county recorder’s office.
- Spousal Property Petition: This procedure only applies to either the surviving spouse or the surviving domestic partner of the decedent. There is no maximum value of real or personal property that can be transferred to the surviving spouse or domestic partner via this procedure. Seek legal counsel if the decedent’s estate is complicated. If the estate is simple, the petition can be used.
What Is Probate? And What Property Goes Through Probate In California?
Probate is the legal process by which the county court oversees that the deceased’s assets are distributed correctly according to the will and to make sure that any debts are paid to creditors. This process is comprised of 7 steps:
- Filing a petition with the court to start the probate process.
- Notify persons of interest about the probate process, including heirs, beneficiaries, and creditors.
- Prove the will so that assets can be distributed according to the will. If there is no will, every state has its own rules for carrying out the estate without a will.
- Take inventory of all assets and an appraisal if needed.
- Pay creditors and expenses that the decedent accrued during the lifetime.
- Check with a tax representative to determine how much in estate, gift, federal and state taxes are due.
- The last step is to take an accounting of all actions taken in regards to the estate.
As you can see this is a pretty lengthy process; it typically takes at least 9-16 months to go through the entire probate process. If you must go through probate, it is recommended to use an attorney. Although using an attorney is expensive, they can be worth it to save yourself from more stress and hassle.
So, What Assets Go Through Probate?
Any assets, either real or personal property, that the decedent owned in his or her individual name or assets held as tenants in common must pass through probate. Even if the decedent has a will but still owned their assets in their individual name, it still goes through probate. If there is no will, assets must pass through probate so that the probate court can make sure that the assets are distributed accordingly. When this occurs, the probate court follows the California intestate succession laws.
Through intestate succession, the assets are transferred to the beneficiaries through a familial hierarchy. First, if the decedent has a surviving spouse assets will be passed to him or her. If there is no surviving spouse, then the estate will be distributed to the decedent’s children. Then to the grandchildren, great grandchildren. If no there are no children, then the assets will pass to the decedent’s parents, if living; then to the other relatives. In a nutshell, intestate succession will pass the estate to the next of kin or relatives; then to parties who have an interest in any of the assets. If no kin can be located, the entire estate will be transferred to the State of California for its own use.
Settling estates can be more troublesome especially when the decedent has multiple and/or complicated assets. Often times, when an estate is large and there are multiple beneficiaries, the successors will dispute over who is entitled how much each heir receives. When situations like this occur, these estates go through probate.
You Inherited A House, Now What?
As you can see, settling an estate can be quite stressful. Not to mention, the anguish you may be feeling with the passing of your loved one. You may be feeling overwhelmed and tired at this point and now you may be thinking that you just want to sell your inherited house and be done with it. If you are looking for a hassle-free process to get rid of your house, then just fill out the form below and we’ll help you through this rough patch in your life.
DISCLAIMER: We are not attorneys. The information on this site is to not be considered as legal advice but to be only used for educational purposes. For questions regarding legal matters, contact a lawyer.