If No Will or Trust, Your Personal Representative Will Need to be Bonded

Funny how not having a Will or Trust to protect your loved ones  can also cost them more money.

If you do not have a Will or a Trust that waives bond, the court will require that your personal representative be bonded unless all of the heirs at law agree to waive bond. And even when they agree to waive bond and sign waivers, the court may still require that the personal representative be bonded. Judges can be funny that way.

This means that to handle an estate without a Will or Trust waiving the bond requirement, your personal representative will have to apply for a probate bond to cover the proposed value of your estate at an enormous cost to them. For example, if your estate is worth a million dollars -- say a medium sized home in CA along with some cash assets -- bond premiums could run approximately $2,000 for every year the estate is opened. The first year's premium is not refundable if the estate closes within a year.

A probate bond is designed to protect the estate in case the personal representative mismanages the estate or runs off with all of the estate assets. It is kind of hard to do when there's real estate involved, but the courts still require bond.

Qualifying for a bond also depends on the personal representative's personal net worth and credit worthiness. Some personal representatives won't qualify and the bond company will require that their attorney maintain control over the estate account in some agreeable fashion with the bond company.

A properly prepared Will or Trust can waive bond and the court will follow your request in your testamentary instrument.

One company that many attorneys use to obtain bonds is Bond Services of California. Their website has bond applications and other information.

As always, seek the advice of an estate planning attorney to prepare your estate planning documents.

Comments

[Orane County Estate Planning]

This is very important information for anyone interested in Estate Planning

[pmelgren@ca.rr.com]

My present husband isn't on deed, does my estste atuomatic go to him upon my death?

[Nike Shox R4]

Whatever we do, we should think twice, then things will be better than past. As the proverb says: all things are difficult before they are easy.