It happens all too often, a person passes away unexpectedly and they do not have a valid will (or Living Trust which we will talk about in our next blog). In the legal world, this is known as dying “intestate.” What happens to the property of the deceased if they die intestate? You might be surprised.
Without a valid Will to dictate how property is distributed, the courts take over and divide the property according to state law. This distribution will normally included the most immediate family members – spouse and children for example – but how the property is divided and who gets what might not always be what you wanted.
In addition, the court will ensure that any debts of the deceased are paid before property is distributed and if assets need to be sold to pay those debts, the court will order that as well. If you didn’t leave a Will to specify which assets should be sold, the court will opt for the most practical assets. This may not be the most beneficial option for your heirs.
The administration process can take weeks or months or even longer, as the court will need to be supplied with a list of assets, including real estate, personal property, stocks and investments, and as we mentioned before, liabilities. Until the administration process is complete, the assets cannot be distributed, creating a potential hardship for family members. Often, a performance bond will be required of the Administrator and that could be costly.
While estates with a Will are probated, the process is often much smoother and even shorter. Because a valid Will is already in place, probate may just involve ratifying, or certifying, that the Will is valid and confirming the executor so that he or she can then begin inventorying assets and notifying beneficiaries.
Obviously, having a valid Will is an important step in the estate planning process. To learn more about drafting a Will, give us a call today.