Probate is the process by which legal title of property is transferred from the decedent's estate to his/her beneficiaries. Since you can't take it with you, the court determines who gets it.
If a person dies with a Will ("testate"), the probate court determines if the Will is valid, hears any objections to the Will, orders that creditors be paid and supervises the process to assure that property remaining is distributed in accordance with the terms and conditions of the Will.
If a person dies without a Will ("intestate"), the probate court appoints a person to receive all claims against the estate, pay creditors and then distribute all remaining property in accordance with the laws of the state. The major difference between dying testate and dying intestate is that an intestate estate is distributed to beneficiaries in accordance with the distribution plan established by state law; a testate estate (after payment of debts, taxes and costs of administration) is distributed in accordance with the instructions provided by the decedent in his/her Will.
What are the advantages of probate?
The proceedings are controlled by a judge, who can decide disputes between heirs or between the heirs and the executor. Creditors are required to submit their claims against the estate within a four-month period, provided they have been notified of the probate. The executor is required, in most cases, to prepare a detailed accounting and report of the executor's activities.
What are the disadvantages of probate?
Simply put, time and money. A typical probate proceeding takes at least six months. It’s not unusual for a probate of an estate with real property to take well over a year. Probate and administration fees will generally range from 4% to 8% of the gross value of the estate.
How much does a California probate action cost?
The California Probate Code sets the statutory fees that attorneys can charge for a probate and for the executor's fees. Higher fees can be ordered by a court for more difficult cases. The fees listed below are the statutory fees used to compensate attorneys and executors in probate cases.
The fees are four percent of the first $100,000 of the estate, three percent of the next $100,000, two percent of the next $800,000, one percent of the next $9,000,000, and one-half percent of the next $15,000,000. For estates larger than $25,000,000, the court will determine the fee for the amount that is greater than $25,000,000.
What does an executor do?
The executor is the person designated to administer all assets in order to settle the estate through probate. Since probate is a time-consuming and frustrating experience that requires numerous signatures and occasional court appearances, it is preferable to name an executor who resides in the state where the probate will be conducted. The executor should be only one person. The executor is usually a family member or trusted friend, but may be a bank trust officer or an attorney. The executor therefore works for the deceased's estate. The executor will still receive his or her full statutory fee which is based on the size and complexity of the estate.
How much will an appraisal of the estate cost?
Estates are appraised by probate referees, who determine the fair market value of the asset. The fair market value includes mortgages and other debts, which can result in an appraisal of the property that is higher than the equity that the deceased owned in the property. Probate referees are appointed by the state controller's office and they receive a fee based on .1 percent of the assets that have been appraised. The appraisal fees must be paid before an estate can be closed.
Can fees can be higher?
In probates that are complicated by circumstances such as lawsuits or tax problems, the attorney and executor can ask the judge to approve fees that are higher than those set by state law.
What about Court costs?
In addition to the statutory attorney's fees, there are costs for court filing fees, appraisal fees, executor's fees, publication costs, and miscellaneous fees charged by the county. A typical estate might incur $1,000 in court costs and other mandated fees.
Alex J. Llorente, Attorney-at-Law