Probate Made Easy – Page 10 – Making The Dream A Reality

March 23, 2022February 7, 2025

Lost Living Trust

Consider this scenario: a married couple bought a house in California many years ago. Advised by a savvy real estate agent, they saw an estate planning attorney right away and created a family trust. In the trust, they have specified who gets their assets once they both pass away.

The couple had three children. Years later, the husband died. Another decade went by, and the wife passed away as well. The children knew that their parents had a living trust set up, but this was done years ago. Now, they can’t find it.

Currently, two children live out of state, while the third one – the daughter – lives in California. They have their own properties, and their lives are well established, so the children get together and decide to sell the parents’ house.

Since their parents had a living trust, they expect a smooth, quick process. They hire a real estate agent. The agent pulls up the grant deed—the house is in both parents’ names. The real estate agent, the children and a title rep get on a phone call. The title rep is asking who the successor trustee is. The children are not sure.

“What does the trust say?” asks the title rep.

“Well, we’re not sure where the trust is”, responds one of the children.

They already searched the parents’ house and did not find the trust. What happens next is, unfortunately, a common situation.

Is Your Trust Recorded? Does County Recorder Have It?

One of the children asks the title rep: “Doesn’t the title company have a copy of the living trust?”

The title rep explains that, no, they would never have a copy of a living trust because California living trusts are private documents. Surprised, the children call the local County Recorder’s Office. Surely, they should have a copy. After all, it’s such an important document, it must be recorded somewhere, right? Wrong!

The County Recorder would not have a copy of a living trust for the same reason a title company doesn’t have it: a living trust is a private document and is never recorded. You wouldn’t record your lease agreement or any other contract between private parties, right?

Normally, each party retains a copy of the signed contract and, in case there’s a dispute, they can go to court and resolve it. A living trust is no different, except that in a living trust, the settlor (the person creating a living trust) is also a trustee and beneficiary until he or she passes away. Then, as instructed by the living trust, a successor trustee takes over.

Is Estate Planning Attorney Obligated to Safeguard Your Trust?

One of the children thought they knew the name of the attorney who set up the living trust, so he decided to call the attorney’s office. Initially, the office declined to discuss this matter because of privacy issues. How is the attorney supposed to know that they are talking to the people named in the trust? How would you feel if your attorney revealed the private trust information to just anyone who called?

Finally, the attorney checked their records and did not find a copy of the family trust in question. Even if you know the attorney’s name, you should never rely on your lawyer to safeguard one of your most important documents. The attorney can pass away. Sell the practice to someone else. Move. The records may get lost in a flood, fire or another natural disaster. The bottom line is that your estate planning attorney is not responsible for safeguarding your trust: you are.

The children have exhausted all the options: they have searched the parents’ house; they have contacted the attorney. Places such as County Recorder’s Office would never have your living trust, so, calling them was a waste of time. So, what’s next? Sadly, the only way out of this situation is to initiate California probate proceedings.

Where There’s a Will There’s a Way… Right?

You may ask: Why probate?

But my parents had the trust. There are three children and no other heirs. Probate is a long and expensive process. Their parents did set up a trust… isn’t there a way? What is a will is discovered but not a trust? Where there’s a will there’s a way, right? Once again, the way is probate.

While this was a theoretical family, just an example, we see this happen all the time. It doesn’t matter how many children the parents had. If it seems obvious that the heir is going to be the only child, the law is the law. Until we can set up an escrow in heaven and have our departed loved ones sign the listing agreement, a missing trust means probate, just like if there was never a probate to begin with.

If you are wondering why probate is necessary, think about this: Isn’t it possible that the parents wanted to disinherit one of the children in their trust? Perhaps they wanted to leave more money to the daughter who lived in California and who used to help her elderly parents more? Maybe somebody has the parents’ will? Perhaps the parents wanted to leave the house not to their children, but to their grandchildren. Maybe a church. A charity…

The main point of having a trust is providing your living loved ones a blueprint: who gets what and when. Who is in charge (successor trustee). Absent that, the law requires the estate to be probated. During the court hearings, potential heirs will have a chance to speak up. Creditors will get their day in court. There is going to be a fair accounting of the estate’s assets. Finally, the house can be sold with a clean title and grant deed, with a documented transfer of the property from the deceased parents to their children and then to the new buyer.

What can we learn from this?

While a living trust is a private document, it doesn’t have to be a secret. Ask your California estate planning attorney to provide you with both paper and a digital copy of the trust. Email it to your children and maybe a trusted friend too. Make it clear who is the successor trustee. This way, your assets will be distributed in the manner that you intended and your legacy will be preserved.

Certified Probate & Trust Specialist

As a Certified Probate & Trust Specialist you can rest assured that as a Real estate professional, I have the understanding of the Probate transaction and can represent sellers or buyers in probate transactions, as well as investors looking to purchase probate properties.

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March 23, 2022August 10, 2025

How Probate Works

Do I need probate and how does it work? These are two questions we get asked most often. While heirs in California may end up in probate court for a variety of reasons, certain situations are way more common than others.

If you are reading this article, chances are, you are going through something similar and looking for the answers. Keep reading to find out who needs probate in California and how a typical probate process plays out.

What’s “Vesting” and Why is it Important?

Consider this: Decades ago, a California couple bought a house. They had three children and build a great life in the Golden State. The couple grew old together. One day, the husband passed away. A few years later, the wife passed away as well.

Three adult children are now trying to figure out how to sell the house. One of them mentions that in order to do so, they may need to file for something called probate. They decide to consult with a probate attorney.

The first thing a probate attorney will do is pull the grant deed to see how the title is vested. “Vesting” is a formal way of saying how one holds title to their property. In California, the most common ways of holding title are as follows:

Sole owner
Tenancy in Common
Joint Tenant
Community Property
Community property with Right of Survivorship
Living Trust

Unfortunately, many Californians who belong to the Baby Boomer generation chose to hold their title as Joint Tenants. Many didn’t have an experienced attorney to advise them. They bought a house, the title company gave them the menu of vesting options, and the couple chose what sounds right or what they heard their peers do, which, in many cases, was Joint Tenant.

This did not present any problems at the time of passing of one of the spouses, as the property automatically went to the surviving spouse. However, upon the remaining spouse’s death, Joint Tenancy, unlike a living trust, does not provide a roadmap as to who is supposed to step into the couple’s shoes and manage the property.

All in all, Joint Tenancy means welcome to probate, unless the real property is worth less than $166,250. Of course, it is nearly impossible to find a property worth less than that in California, so, once again, Joint Tenancy means welcome to probate.

The attorney informs the adult children that they will need probate to sell the house. In essence, probate, while it is a complex process governed by California Probate Code, solves a simple problem: with the original homeowners gone, who can legally take over and sign legal documents, such as listing agreements and other contracts? Who can get on the grant deed and become a legal owner? The probate process is designed to do that so, if the house is sold, the buyers can purchase the property and get a clean title, while the rightful heirs can divide the sales proceeds.

California Probate Timeline

The next big question is how does the probate process work in California? Below you will find detailed and simplified versions of the probate timeline, as well as a summary of a typical probate process.

Probate Timeline (Full)

Probate Timeline (Simplified)

Normally, probate in California takes somewhere between 10 months and one year to complete. That is if the heirs hire an experienced attorney and there’s no fighting between the children. The most common disagreement is about which sibling is supposed to be in charge (appointed as a Personal Representative). An experienced probate attorney will call a meeting early in the process, flesh out the details, and ensure that everyone is on the same page.

The probate process is started by filing a Probate Petition. The purpose of the petition is to present all the details about the decedent’s estate and ask the judge to appoint the Petitioner to serve as a Personal Representative. The petition costs $465, which are paid directly to the court. Think of it as a fee you would pay at the DMV or any other government office. It’s just a fee set by the State of California.

Once the petition is received, a judge will schedule a hearing date. Siblings do not need to attend the hearing – the attorney will handle it. If everything goes as planned during the hearing, the Petitioner will get appointed as the Personal Representative (often abbreviated as PR).

If the heirs wish to sell the house, it can be in the first 90 days of the process. An experienced probate real estate agent will sign a listing agreement contingent on the Petitioner becoming appointed as PR, so they can start marketing the house right away. If all the parties know that they’re doing, the home can be sold in 90 days.

Simultaneously, more documents will be issued by the probate court. The court will arrange a probate referee to appraise the home. The attorney’s office will assist heirs in setting up the estate’s bank account, obtaining a tax ID, etc.

Once the house is sold, the probate process is not finished, even though the buyers get possession of the house. The next step is issuing noticed to creditors, such as Medi-Cal, certain other government agencies, and credit card companies. Once again, a savvy probate attorney can help heirs legally avoid paying certain creditors, thus, saving tens of thousands of dollars for the estate.

Dealing with the creditors takes another 120 days.

Finally, the last 90 days of the California probate process are dedicated to final accounting and asset distribution. As mandated by the California Probate Code, no money can leave the estate account until the judge reviews all the proceeds and expenses and gives his or her final approval. An experienced probate attorney will help avoid any delays or confusion, so all the requirements are satisfied, and the judge has no reason to extend the process.

Finally, the Personal Representative and the probate attorney receive the payment for their services, and all the remaining beneficiaries (heirs) get their shares as well. Whoever paid the initial court filing fee of $465 also gets reimbursed.

So, here you have it. This blog post answers two popular California probate questions: “Do I need probate?” and “How does it work?”

Certified Probate & Trust Specialist

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All Information is deemed reliable but not guaranteed. Information is for educational purposes only.

March 23, 2022August 23, 2025

Blended Family

Do you know what’s the most common objection to not having a living trust? “My situation is different.” Many California homeowners genuinely believe that while a living trust may be a valuable estate planning tool for somebody else, their personal situation is somehow unique. How unique? “Simpler.” Oh, it’s just me and my wife. Or: I only have one child; we’re leaving everything to our son anyway.

An experienced estate planning attorney who has dealt with hundreds, possibly, thousands of trust and probate cases can easily poke holes in all these arguments. Admittedly, some families may benefit from a living trust more than others, and in some cases, having a trust is an absolute must.

One of such situations is a blended family. This is what we are going to explore in this blog post.

What is a blended family? It’s a family where at least one parent has children that are not biologically related to the other spouse or partner. Either parent, or both, may have children from previous relationships. The latter is what we usually mean when we are talking about a blended family: both spouses have children from previous relationships. If there’s one type of family who absolutely needs a living trust, it’s this one.

It all comes down to vesting, aka holding title to your property. Let’s say two individuals with children from prior relationships get married and buy a house in California. The wife has a daughter, and the husband has a son. At the time of the purchase, they had to choose how they were going to hold title. Unless advised by an estate planning attorney, most Californians are still choosing Joint Tenancy, so our hypothetical couple does that.

The couple lives a long, happy life. Since they have married later in life, they did not have any children together, only the ones they already had from prior relationships.

Years later, the wife passes away. Soon after, the husband dies as well. The only heirs are two adult children from previous relationships – the late wife’s daughter and the husband’s son. The couple did not have a trust and chose to hold title as Joint Tenants. With both homeowners gone, who gets the house? Both children equally? One child (which one)? Somebody else?

Let’s unpack this. When the wife died, under Joint Tenancy, the husband automatically became the owner of the estate. When he died, the house goes into probate. Once the probate process is over, his son gets it all.

But what about the daughter? Too bad, so sad. Under Joint Tenancy, last one standing gets it all. The last tenant was the husband, who happened to have one son. Absent living trust, the son gets it all, while the daughter does not get a penny, since she was not his daughter, but the daughter of his no deceased wife.

This is just one of many possible inheritance scenarios common in blended families. There are various ways to tweak the outcomes, but only one estate planning vehicle – a living trust – can ensure that the assets are distributed in accordance with the wishes of the spouses.

A living trust set up by an experienced estate planning attorney is like a blank canvas that can be turned into a beautiful painting… Had the couple consulted with an attorney, they would have ended up with a comprehensive trust which would specify who gets what, and when.

For example, the couple could have opted to go half and half: half of the estate goes to the son, another half goes to the daughter after both spouses pass away. Another option is to say in the trust that certain assets acquired by the spouse prior to the marriage go to their respective children, while the house should be sold and split in half. The beauty of a living trust is that it allows being very precise in how you want your assets to be distributed upon your death.

Unfortunately, having no trust means probate, and probate follows general rules set in place by the State of California, which may not always align with your wishes, especially in complex situations like having a blended family.

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All Information is deemed reliable but not guaranteed. Information is for educational purposes only.

March 23, 2022February 7, 2025

Rogue Successor

What happens if a successor trustee named in a living trust goes rogue and refuses to carry out their duties? What if the same successor trustee takes action but does not follow the wishes of the original trustee? In this blog post, we are going to examine a hypothetical scenario of a rogue successor trustee and what can be done to make them perform.

The Basics of a California Living Trust

California laws allow individuals and families to create trusts that will spare their heirs the expensive and time-consuming probate process. When set up by an experienced attorney, a trust avoids probate completely saving tens of thousands of dollars to the estate.

California living trust is a private document. It means that it doesn’t get recorded at the local county recorder’s office. It doesn’t get filed with any other government agency. Parties involved in the trust get a copy of it, including a digital copy, and they are responsible for safeguarding the document. If a trust is lost, game over: welcome to probate.

Privacy is one of the living trust’s best features. If a trust was recorded, any member of the public would know how much assets you have, and how much money you are giving to your children, other family members, and charities. Your entire finances would be accessible to the public.

At the same time, we get asked the following question: If a trust is not recorded, who is going to ensure that the successor trustee will do their job? What if they refuse to follow the original trustee’s wishes?

Let’s look into this.

Incentives to do the right thing

The good news is that in most cases, successor trustees discharge their duties without as expected. After many years of practicing in estate planning, we found that the common fear of litigation or disagreement between the parties of a trust is rather unfounded. Yes, lawsuits do happen, but they are not as common as many Californians think.

After all, a person doesn’t just sign up to be a successor trustee. They are picked by the maker of the trust. Naturally, they would choose someone they find to be honest, someone they probably know for many years. In the most typical situation, a successor trustee is one of the children.

In addition to having a moral and legal obligation to do right by their parents and siblings, California Probate Code section 15680 says that a trustee is entitled to be compensated as set forth in the trust. This is in addition to the successor trustee usually being one of the beneficiaries in the estate. It is in their best interests to follow the trustor’s wishes so they can get their piece of cake as well.

Successor Trustee As a Nightmare Tenant

Unfortunately, occasionally, we do run into a rogue successor trustee. There are many reasons why someone may decide to ignore the settlor’s wishes and break a contract (trust is, after all, a contract). Let’s examine one of the most common situations in which a successor trustee may decide to go rogue.

In this hypothetical scenario, a married California couple had 5 children. The couple’s estate included their house. One of the sons lived with the parents until both parents passed away. The parents had a living trust and the same son who was living with them had been named a successor trustee.

The trust says that the house must be sold upon the parent’s death, and the proceeds must be divided into five equal parts. However, the son, who is also the successor trustee, continues living in the house rent-free and refuses to initiate the sale of the house. He avoids other siblings’ calls and, when cornered, tells them he will hire a real estate agent to help with the home sale “son.” He just needs a few more months to save up some money and find another place to live.

A year goes by and nothing changes. The successor trustee becomes a nightmare tenant: he won’t move, and he won’t agree to sell the house. Since he is the only one who can sign the listing agreement, the other siblings feel powerless. What should they do?

While the process may not be what most families want, it is rather straightforward. It also happens to be the only solution that will eventually result in the sale of the property. The rest of the siblings must hire an attorney and sue the successor trustee. The attorney representing the siblings will present the evidence to the judge. As long as the living trust was prepared by an experienced attorney, the judge will rule to remove the non-performing successor trustee, which will allow what’s called “marshaling of the trust asset.” It’s legalese for locating and taking charge of all the estate assets.

As a result, the property can be sold and proceeds divided as intended by the trustor. However, before this can happen, there is one not-so-minor detail: if the ex-successor trustee is still refusing to vacate the property, they will have to be evicted just like any other tenant illegally occupying the home.

Certified Probate & Trust Specialist

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All Information is deemed reliable but not guaranteed. Information is for educational purposes only.