A
Another “Do it yourselfer”
lot of people are interested
in avoiding probate these
days. Pete already had a
Will but he read an article
about how to avoid probate. He decided that’s what he wanted to do and that he didn’t need an
attorney. He knew he didn’t have much
time because he had terminal cancer.
Pete wanted to leave his estate to his
three daughters. He already had them
listed as beneficiaries on his bank accounts. He owned his home and two
rental houses. A friend told him he could
deed each house to himself and one
of his daughters so he would co-own
each house with a different daughter.
By continuing to co-own each house,
Pete would be able to keep control of
each property. He wanted each house
to pass to one of his daughters upon
his death so that a probate of his estate
would be unnecessary.
So Pete headed to the county law library and told the librarian what he
wanted to do. She explained that she
wasn’t a lawyer and couldn’t give legal advice and then showed him a
book where he could look up the deed
forms. After studying the books and
forms, he made some copies. He filled
in the blanks and took the deeds to
the county clerk’s office and recorded
them. He felt pretty good about himself
since he had saved whatever fees a
lawyer would have charged to advise
him and draft the deeds. His Will designated his oldest daughter as execu-
By Craig Watson
trix so he called her and told her what
he had done and that his estate would
not have to be probated.
After his death, his daughters took the
deeds to the county appraisal district
and asked them to put each house into
the designated daughter’s name. The
appraisal district employee stated that
Pete’s estate still owned half of each
house and his Will would need to be
probated. The daughters were confused so they made an appointment to
see an elder law attorney about probating Pete’s estate. The attorney reviewed
the deeds and realized that Pete had
used the wrong deed to accomplish his
goal. The attorney asked if Pete had
any other assets or debts. The daughters explained that Pete had one credit
card balance but that his bank accounts
had already passed to them because of
the beneficiary designation on each account. However, a hail storm had damaged the roofs on the houses and the
insurance company had already sent
them a check made out to Pete’s estate.
The attorney explained that Pete’s estate normally could have qualified to
be probated as a muniment of title,
which is usually a cheaper, faster type
of probate but because of the credit
card debt and the insurance company
checks payable to Pete’s estate, a full
independent administration would be
required. The attorney explained that
if Pete had come to see him about the
deeds, his fee for the consultation and
drafting the deeds would have been
less than a thousand dollars. Now, the
cost of the legal fees, clerk filing fees,
etc., for probate would be in excess of
$2,000, in addition to the daughters’
valuable time spent to meet with the attorney, attend court hearings, and suffer the delays of probate. Pete’s daughters were disappointed.
This is a true story, although the names
have been changed. Pete’s estate was
worth over $1,000,000. He worked
hard to accumulate his estate. The legal
fees to properly accomplish his goal of
avoiding probate would have cost less
than 1/10 of 1% of the value of his estate. In this day and age of the internet,
a fair number of people are trying to
plan their estate without the services of
an attorney who concentrates his practice in estate planning and probate.
Certified Elder Law attorneys spend
three extra years of their lives attending law school and annually pay for
many hours of continuing legal education away from their offices in order to
become experts at their craft. But the
best training of all is simply practicing
law every day and experiencing lots
of different situations. Unfortunately for
the families of the Petes of the world,
a fair number of people are making
expensive and time consuming errors
while trying to do it themselves. The
costs of fixing the problems caused by
poor planning are always far more expensive than it would have cost to do it
right the first time. Don’t make the same
mistake Pete made.
Craig Watson’s law practice focuses on Estate Planning, Probate, Guardianship and Elder Law.
Formerly a CPA, he has 25 years of experience. Call 903-813-8500 or go to Craigwatsonlaw.com.
TEXOMA AREA Living Well Magazine | FALL 2015
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