Most people have heard of probate before — but they probably don’t know exactly what it means or how it works.
Probate is the term used to describe the basic process of settling the estate of a deceased person. Whether there is or isn’t a will, the deceased’s assets need to be collected, creditors may need to be paid and heirs need to collect their inheritances.
Probate operates in phases. If there’s a will, an executor will be named to handle the steps. If there isn’t, the court will name someone to fill that role.
Phase 1: First, the assets of the deceased have to be inventoried
That may be a relatively quick process or it can take a long time — it all depends on how complex the deceased’s financial holdings are. It may be necessary to collect debts owed to the deceased, file for life insurance policies and empty bank accounts. If there are antiques, collections and items of significant value, appraisals may need to be done.
Phase 2: Next, creditors have to be handled
While probate is “open,” there’s a period of time for creditors to step forward and stake a claim — if they haven’t already. After a certain amount of the estate is set aside for a surviving spouse and minor children, the executor will pay the probate expenses, the funeral costs, any taxes, unpaid bills and other final expenses of the deceased. Sometimes its necessary to get some legal advice on estate claims in order to know what to pay and what to reject under the law.
Phase 3: Finally, probate is closed and the remaining property and assets are legally passed to the deceased’s heirs
If there’s a will, the executor will follow it. If there isn’t, the state will direct how the assets are to be divided.
Naturally, this is just a broad breakdown of the probate process — but it’s a good place to get started if you aren’t sure how things work and it can help you understand what to expect whether you’re someone’s heir or executor.
Source: New York Life, “How the probate system works.,” accessed May 16, 2018