Today I want to provide you with a cautionary tale; the moral of the story being in order to avoid probate, you need to have an estate plan in place. If you want your heirs to avoid having to go to court and spend money from the estate, time and expense, then you need to do everything you can to put an estate plan in place.
I had a call from somebody whose husband died recently, and the house that they lived in is listed in his own name solely, not in the wife’s name at all. That means that she is going to have to go through probate in order to get the judge to order the house to her. He didn’t have a will, he didn’t have a trust, he had nothing. She’s in luck because according to the Nevada statutes of intestate succession, which I’ve talked about in previous blog posts, the statutes say that if the spouse dies, then the wife gets it unless there is children. If there are children, then the wife gets 50% and the children get 50%. In this case, they don’t have any children so since she’s the only heir. She gets the house, the caveat being that she’s going to have to go through probate court in order to get it so it’s going to be a while before she gets title put in her name.
In this example, the house is worth about $300,000 and there’s a $24,000 mortgage remaining on the property. For purposes of probate court, that means that the equity, the value of the assets, is about $275,000 because you don’t include the debts, which of course is the mortgage. Depending on the value of an estate, you have different levels of probate. We’re looking at $275,000 as the total value of this estate which means, she will be in the summary administration level, which is for estates valued between $100,000 and $300,000. This particular level takes approximately six months to go through. However, she is not selling the house in probate so it will take about 30 days less because she’s not selling. She’s still going to have to go through court and pay me, the attorney, a couple thousand dollars to handle it.
Overall, it is not an easy process. What could have been avoided entirely by simply having an estate plan, particularly putting the house in a trust, is now going to take time and money in order to resolved. Please, have an estate plan ready if you care at all about the people you leave behind. If you want to talk more about probate, visit our Website for more information.
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