Q: What is California Probate?
Probate is the process of wrapping up a person’s affairs after death. This includes distributing property to heirs and beneficiaries. In California, probate requires a legal proceeding in the Superior Court of the County where the person resided at the time of death. Generally, a relative of the deceased can petition the court to begin the probate process, although it can also be started by a non-relative or even a creditor of the deceased. The Probate process is governed by the California Probate Code. At Edwards Legal, we handle probate cases in San Bernardino County, Riverside County and Los Angeles County on a regular basis. We can also handle cases in other counties…Call for more info.
Q: Is all property owned at death required to go through the probate process?
All property owned by a person at the time of death is considered part of their estate. However, there are some exceptions. Although a probate proceeding may be required, there are certain items that can pass to heirs or beneficiaries outside of the probate process, without significant delay. Below are a few examples:
Life Insurance
A life insurance policy can provide a payment to loved ones upon an insured person’s death. This is usually in the form of a lump sum payment. Life Insurance policies allow the insured person to pick a beneficiary to receive the lump sum payment when they eventually die. The person to receive the payment is called a named beneficiary. Amounts to be paid to the named beneficiary are not included in the probate estate. Therefore, the life insurance payment is generally not subject to the probate process.
Bank Accounts
Certain types of bank accounts become the property of a named beneficiary at the death of the account holder and avoids the probate process. This typically includes joint accounts and accounts with a named beneficiary called Payable on Death (POD) accounts. Joint accounts are accounts with more than one person sharing equal ownership of all funds in the account. When one account holder dies, the remaining joint account holder owns the account. If there is no joint owner at death, but the account holder has named a beneficiary, the beneficiary immediately becomes the owner of the funds remaining in the account. The probate process is not required to receive these funds.
Property held in Joint Tenancy
Like joint bank accounts discussed above, other property can be owned jointly with another person. This is very common with real estate. During the 1980’s and 90’s, many married couples were advised to take title to their real estate as Joint tenants with right of survivorship. If one of the owners dies, the remaining (or surviving) owner immediately becomes the full owner of the property. Property held this way does not pass through probate. It is not included in the decedent’s estate at death.
Property in Trusts
Over the last two decades living trusts have become a popular tool for estate planning. Generally, a Trust is created when the owner of property relinquishes control of the property to a third party (trustee) to be held for the benefit of the owner and/or other beneficiaries. The Trust is considered to be the owner of the property and it is therefore no longer a part of the owner’s estate when he/she dies. Property held in a valid trust is not subject to the probate process.
Q: What if person has a valid will when they die? Do we still need to probate the estate?
Some of the main purposes of having a will is to identify what a person wishes to be done with their property upon death, and to designate who will take care of minor children and/ or handle their final affairs. Contrary to popular belief, estates do not avoid probate because there is a valid will. Although the court will honor the deceased’s wishes in a valid will, the probate process will still be required.
Please note: A probate can be avoided with proper estate planning. See estate planning section for more information or click here.
Q: How long does the probate process take?
That’s not an easy question to answer. There are many variables that can affect the amount of time needed to probate an estate. In order to get a better idea of how long the process takes, let’s think of the probate process in 3 stages.
Stage 1- Appointing an Administrator/ Executor
The first stage in the probate process is appointing a personal representative to act as Administrator/ Executor of the estate. This person is granted the authority to handle all matters to settle the deceased’s estate. A petition is filed with the court to begin the process. A hearing is set approximately 30 days later. Generally, if all procedural requirements are met, and there are no objectors, the administrator will be appointed at the hearing. If the court requires additional information the hearing may be continued (re-scheduled) until it is satisfied and appoints the personal representative. The court will then grant the order and issue “Letters of Administration/Testamentary” giving authority to the Administrator/ Executor.
Stage- 1 can take 45-90 days in a typical probate proceeding.
Stage-2 Marshalling Assets and Dealing with Creditors
Once a personal representative has been appointed, all estate assets must be accounted for. In addition, the decedent’s creditors can file claims to be paid out of the estate assets. Creditors are allowed up to four months after the “Letter of Administration/ Testamentary” have been issued to file their claims. In addition, assets may need to be liquidated to pay creditors or to allow for cash distributions to heirs/ beneficiaries. This can be a lengthy process depending on the types of assets in the estate that need to be valued, sold, and distributed.
Stage- 2 can take 4-6 months in a typical probate proceeding.
Stage-3 Final Accounting and Estate Distribution to Heirs/Beneficiaries
In the final stage a complete accounting is presented to the court and distributions are made to the heirs/ beneficiaries.
Stage- 3 can take 60-90 days in a typical probate proceeding.
In Southern California, you should expect the probate process to take approximately 10-18 months.
Please note: The time estimates above will be greatly impacted by; 1) the Administrator/ Executor’s ability to satisfy Probate Court requirements, 2) the complexity of estate assets, 3) disputes between heirs/beneficiaries, and 4) how busy the Probate Court calendar is in your jurisdiction.