If you discover that you have been named an executor to a loved one’s estate, or if you already know that you will be responsible administering his or her estate, the probate process may be completely unfamiliar to you. This is understandable, and you may have fears that the process may be fraught with emotional legal battles that can divide families.
While these horror stories are less likely to happen, it is important to know that the probate process is geared to be an orderly process of transferring assets from one person (the deceased) to another (a beneficiary). Indeed, there can be disagreements about how this is supposed to take place, especially when there is no will, or a provision within such a document, that details what is supposed to happen to an item or property.
However, there are certain assets that don’t need to go through probate; which can alleviate the concerns and legal wrangling about who is supposed to have them.
Property held in joint tenancy – When property is held in joint tenancy, a person’s interest in such a property automatically passes to other surviving tenants. This could be a person’s spouse or other owners of the property. Indeed, there may be a dispute over how the deceased’s interest may be divided, but the transfer of interest does not necessarily need to go through probate.
Life insurance proceeds – The money that will be distributed from a life insurance policy does not have to pass through probate primarily because beneficiaries are already listed in the policy. Essentially, an insurance company will pay out the policy once it receives proper notification of the policyholder’s death.