The probate process can sometimes be slow and costly. It can also leave information the client might just as well keep private vulnerable to scammers and even burglars. For these reasons, many of your clients will wish to avoid this process. As a real-estate expert you can add value to your clients and make things easier for yourself by letting them know how this process can be avoided when possible. Here are three secrets your client can use to avoid probate.
- Write a living trust: Many people believe that simply having a last will and testament will prevent their loved ones from going through probate. This is not necessarily so. The truth is that all the assets that you own and will pass on to your beneficiaries are subject to probate. A revocable living trust circumvents the probate process which can leave your beneficiaries waiting indefinitely for the income from the probate property. A revocable living trust is a document whereby you can create a living trust as a separate entity from yourself. The trustee can easily transfer the property it holds to the family and friends it was left to without probate.
- Joint Ownership of Property: By taking joint ownership of a property your client can avoid probate after the first owner dies. Be sure your client has stated on his/her deed how they want the title to be held. This way the property goes to the joint owner when the primary owner(s) dies, avoiding probate completely. Your client can avoid probate using the following kinds of joint ownership: Joint tenancy with right of survivorship, tenancy by the entirety and community property with right of survivorship.
- Pay-on-Death Accounts and Registrations: Suggest that your clients designate a beneficiary or beneficiaries on their bank accounts, insurance policies, pension plans, 401K plans, IRA accounts, stocks and bonds. This is actually quite easy and these financial instruments often include language that allows you to do so when you open them. Your client is then able to ensure that his/her assets are immediately dispersed without having to go through probate first. Again, this can save him/her much time and expense.
This list is by no means complete but it is a good start to avoiding the tedium of probate. Even though probate can generate listing leads, your client can begin to do things to avoid the process starting today if they so desire.