Taking Title to Assets That Weren’t Held in Trust

While the procedure for taking title varies depending on the asset type, following is an overview for some of the more common types of assets.

Real estate not held in the name of the trust prior to the decedent’s passing is more involved than it would have been otherwise. Depending on who held title to the property, the transfer may be relatively straightforward, or it may be complex. For example, if the decedent was the sole individual who held title, the transfer may involve an affidavit of death, a probate court order, and a new deed recorded in Orange County or the appropriate county where the property is located. If the decedent held title with a predeceased spouse or other individual, however, additional documentation is required.

For financial accounts, automobiles, insurance policies or other assets that are not considered real property, it may be possible to transfer title of the asset by using a declaration that states you have met certain statutory requirements.

These requirements are outlined further below:

• More than 40 days have passed since the death of the decedent.
• No probate proceedings are pending or will be filed.
• The trustee is the person entitled to collect the asset.
• The declaration is signed under the penalties of perjury.
• The total value of all of the assets of the decedent subject to probate are worth less than $100,000, excluding homes, vessels, and certain employment-related death benefits.

Feeling overwhelmed by your duties as a successor trustee? We can help. We encourage you to view our client testimonials page today to learn more about how we have helped many others with trust administration in California.

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Take Title to Assets of the Trust

While there are many different ways to take title of an asset depending on its type, certain assets are more common than others. The following is an overview for taking title to three of the more common assets types in a trust administration, assuming these assets were already held in trust prior to the decedent’s passing:

• Real estate. Real estate held in the trust prior to the decedent’s death will have a deed on record with the county recorder in Orange County, or the appropriate county where the property is located. The deed states that the property is held by the trust. After the decedent passes away, the successor trustee will typically prepare and record an affidavit of death of the original trustee. This document is used to show that the decedent is no longer acting as trustee of the trust, and instead, the successor trustee is now the trustee. The successor trustee is able to sign deeds or otherwise transfer title to the property.
• Financial accounts. Most banks and brokerage houses will request a trust certificate in order to transfer accounts held in trust to the successor trustee. The trust certificate must comply with California law and state certain information about the trustees and the trust. The successor trustee will then present the financial institution with the trust certificate, a death certificate, and proper personal identification. The successor trustee is then allowed to collect the cash or securities held in the account.
• Personal property. Some types of personal property have no means of registering title, such as furniture, clothing, or tools. For these items, the trustee simply takes possession, if possible. In situations where someone else is holding the property and refuses to deliver it over to the trustee, it may be necessary to seek court intervention.

With so many duties and responsibilities associated with a trust administration, tips and guidance from an experienced professional are often beneficial. We encourage you to sign up for our free newsletter today!

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Understanding Overbids During the Sale of Estate Real Estate

When real estate of an estate is scheduled to be sold, the personal representative reports the sale and petitions the court for confirmation. This occurs within 30 days of accepting the offer. At the confirmation hearing, the original sale may become subject to being overbid by other purchasers.

How does this work? Other prospective purchasers can attend the hearing and submit a bid in an amount that equals the amount of the original bid, plus both of the following:

1. A minimum of 10 percent of the first $10,000 of the original bid, plus
2. A minimum of five percent of the amount of the original bid that exceeds $10,000

If there are further overbids after the initial overbid, the court handles these additional bids in much the same way as a real estate auction. The court will determine how much of an increase each subsequent bid is required to meet. Thereafter, bids will continue to be accepted until the highest bid available has been made.

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Related Links

• Ten Real Estate Questions to Ask while Creating Your CA Estate Plan
• Four Ways to Handle Real Estate Under a California Estate Plan

When creating an estate or financial plan, elderly clients should be wary before taking on the increasingly popular reverse mortgage. A new report highlights the dangers that stem from these loans and the substantial financial consequences that could result. The report shows that some reverse mortgages have base interest rates as high as 9.95%, with a 50% share for the lender of increases in value of the house after it is sold. On top of all that, some loans impose a 2% “maturity fee,” as well as a $33,000 mandatory purchase of an annuity that is added to the principal balance of the loan. The annuity also incurs compounding interest.

One woman, Sarah Havemeyer, is currently embroiled in a legal battle with a California bank over her late mother’s reverse mortgage. The mortgage was taken out in 1997. Havemeyer estimates that the bank, OneWest, could be entitled to between $1.5 million and $1.6 million under the terms of the loan. Alarmingly, Havemeyer’s mother only received $272,911.51 from the mortgage between 1997 and her death in 2010. As a result, the estate and its beneficiaries will take a devastating financial loss.

Reverse mortgages are sometimes used by borrowers as part of an overall estate or financial plan in order to provide liquidity. A reverse mortgage places a lien against a senior’s home. In exchange, the bank receives periodic or lump sum payments. The full amount of the loan is not due until the borrower either dies, moves, or sells the home.

Havemeyer, as executor of her mother’s estate plan, has been involved in estate litigation with the bank for more than two years. She alleges that the terms of the loan are “unconscionable and usurious.” This is not the first time a reverse mortgage has been challenged in court. A series of lawsuits have been fought in California over the terms of these loans, citing “financial abuse of the elderly.”

To learn more about this and other issues to carefully consider when creating an estate plan, contact the experienced Anaheim trust attorneys at the Law Office of James F. Roberts and Associates, APC, today. Call our office at (714) 282-7488 for a consultation.

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Why Do You Need A Will If You Already Have A Trust?

Many of our clients ask why they need a will if they already have a trust, and vis versa? The Pour-over will works in conjunction with the living trust. I explain to them that the idea is to have all of their assets transferred into their trust while they are living to avoid probate with respect to those assets when they pass away. Unfortunately, that does not happen for all clients. More often than not, a client will pass with one, some, or even all of their assets entirely out of the trust.

Pour-Over Will To The Rescue!

That is where the pour-over will comes in. The pour-over will acts as a safety-net for those assets and transfers them into the living will so we avoid probate. The thing you have to remember is that a pour-over will can do this for only up to $150k in total. Perhaps the s most important reason to have a will, is that it allows you to name a guardian for your minor children in the event that you are not there to raise them yourself.

If you have questions about a pour-over will and whether it can benefit you, please call our office and set up an appointment to speak with one of our attorneys.Contact us today and set up an appointment.

We offer a many different resources and pamphlets on the subject of creating, updating and implementing estate plans. We also offer a regularly scheduled seminar in our office to help people determine what the best options are for them in their estate planning needs. We hope you sign up for one of our seminars to help you find your best options.

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No. Whether certain property has to go through probate depends on a number of factors that are specific to the estate.

Sometimes Probate Can Be Avoided

Some common examples of property that can avoid probate include:

• Property that was owned in joint tenancy with someone else.
• Property that was in a living trust.
• Property that was held in a revocable living trust.
• Property that was in an account that had a payable-on-death beneficiary named to it.
• When the total value of the estate does not meet the minimum threshold for probate court.

Of course, with the exception of the estate’s value, these things must be established by the creator of the estate before his death. As a potential beneficiary, a trustee, or an executor, it is important to recognize what should go through probate, and what shouldn’t. This makes it easier to take the necessary actions to administer the estate fairly and quickly.

Probate Isn’t Something to Fear

Sometimes, probate court is unavoidable and that is okay. Certain estate plans were not created with the intent to avoid probate, but instead the wishes of the decedent were better accomplished with some assets passing through probate court.

Accordingly, if you are the administrator or executor of an estate that needs to go through probate—then it is important to take the time to learn the rules. You need to know what to do and when to do it, but you don’t need to do everything alone. Instead, you have the right to contact an estate planning lawyer for help and to make sure that everything is done in the best interest of the estate. To learn more, please fill out our online contact form today and we will contact you directly to talk about the specific issues that you face.

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If your loved one owned real property, or an interest in real property, not owned in the name of the Trust, then the Trustee must file the appropriate affidavit.
For example, if the property is held in joint tenancy, then the appropriate affidavit is an Affidavit of Death of a Joint Tenant.

A Preliminary Change of Ownership Report (“PCOR”) must also accompany the Affidavit of Death. The PCOR notifies the county assessor that a change of ownership has occurred and depending upon who the property is transferred to, the property may be subject to a reassessment of the property tax.

If you have questions about the Affidavit of Death, please call our office at (714) 282-7588 and one of our experienced estate planning attorneys at the Law Office of James F. Roberts & Associates, APC, will be pleased to walk you through this process.

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Generally, the following are four common ways that real estate will pass to your beneficiaries after your death:

• If the real estate is placed in a revocable living trust, the property will pass in accordance with the terms of the trust instrument. The California probate court will not need to oversee this process, absent certain circumstances.
• If the real estate is distributed under the terms of your will, it will pass as of your date of death under that instrument. It will likely become a part of the California probate administration process.
• If the real estate is owned jointly with another party who has a right of survivorship, the property will pass automatically to that individual following your death. It will not be a part of the California probate administration process.
• If the real estate is owned in your name individually, and you did not create a will or trust to manage its distribution, the property will pass under the laws in the state of California. Its distribution will be overseen by the California probate court.

Four Ways to Handle Real Estate Under a California Estate Plan. For more information about creating your estate plan involving real estate, view our free guide, The Ten Things You Must Know Before Creating (or Amending) your Will or Trust. Contact the experienced Orange County estate planning attorneys at the Law Office of James F. Roberts & Associates, APC for guidance. Call our office today at (714) 282-7488 for a consultation.

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Five Considerations for Deciding Whether to Sell Real Estate Under the IAEA

Since the facts and circumstances surrounding each estate administration are unique, personal representatives must make a decision on whether or not to sell real estate under the IAEA. In some cases, the personal representative may prefer the greater involvement of the court. Personal representatives must consider the following when making this choice:

1. The process for selling the real estate under the IAEA is usually quicker if court supervision is not involved.
2. Selling the real estate under the IAEA avoids the requirement for overbidding or court confirmation of the sale.
3. Overbidding, can, however, result in a higher overall sale price for the property.
4. The personal representative is able to agree to any terms and contingencies that it sees fit, provided that such terms and contingencies are in the best interest of the estate and the beneficiaries.
5. The current economic and real estate market.

Deciding Whether to Use the IAEA to Sell Real Estate During an Estate Administration.After taking all of these considerations into account, the personal representative can then make a decision as to whether to take advantage of the provisions of the IAEA, or to instead opt for greater court involvement in the process. For additional helpful information about implementing estate plans, we encourage you to sign up for our newsletter today.

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