Probate refers to the legal process by which a person’s assets and finances are handled after they pass way.

The probate process does the following:

• Pays debts the deceased owes
• Collects debts owed to the deceased
• Transfers assets to the deceased’s beneficiaries

A simple probate process can be settled within six months after the appointment of an executor or administrator. It is usually initiated in the county that was the deceased’s legal residence when they died. If the deceased owned property in various states, there will be a probate process for each property in its particular state.

There are basic steps involved in each probate process. The process may differ somewhat depending on which state you are in.

1. Appointment of an executor or administrator

If the deceased had a will, they could name someone in it to be their personal representative. This person will be in charge or the deceased’s estate.

Tasks the personal representative would have to do on the deceased’s behalf include:

• Caring for all the deceased’s property
• Notifying creditors and the public about the deceased’s death
• Receiving payments due to the deceased’s estate, including interest, dividends and other income
• Collecting debts, claims and notes due to the deceased’s estate
• Determining the names, ages, addresses and degree of relationships to all the deceased’s heirs and beneficiaries
• Investigating the validity of all claims against the estate and paying all outstanding obligations
• Carrying out the instructions of the probate court and distributing the deceased’s assets to his or her heirs or beneficiaries.

The first responsibility of the personal representative would be to obtain the right to handle the deceased’s estate’s affairs. They would have to file a document called a “Petition for Probate of Will and Appointment of Personal Representative” with the probate court. This should be accompanied by the death certificate and a certified copy of the deceased’s will. Once the court gives your personal representative a certified document called the “Letter of Administration” or “Letter Testamentary” they can start acting on the deceased’s behalf.

If the deceased didn’t have a will or did not name someone to be their personal representative, the state will appoint an administrator to handle their affairs.

2. Notifying your creditors and the public of the deceased’s death

Some state laws require the personal representative to publish a death notice in the local paper. This serves as a public notice of the deceased’s estate’s probate and enables creditors to file a claim against the estate within a certain time period.

Once probated, the deceased’s will and subsequent filings with the court are a public record and open to inspection by anyone.

3. Inventorying the deceased’s property

The personal representative must make an inventory of all the property that makes up the deceased’s estate in order to determine its value. This inventory must be filed with the court. The reason for this is twofold:

• To make sure that there is enough to cover the deceased’s debts and distributions to their beneficiaries. If there is not enough, the deceased’s estate will be subject to abatement statutes, which means their beneficiaries may receive less than intended or nothing at all.
• To ensure that all the deceased’s property is accounted for

4. Paying outstanding debts and dealing with legal claims

The personal representative will pay all the deceased’s final bills, debts, taxes and any claims against their estate. He or she will also determine which claims against the estate are valid and which should be rejected. He or she may also hire an attorney, with estate funds, for advice or to defend or negotiate any legal claims.

5. Distributing the deceased’s assets among their beneficiaries and heirs

Whatever is left after the deceased’s creditors get their money is distributed to the heirs and beneficiaries as the will directs. The personal representative generally will have the discretion to distribute the estate in cash or in kind. If the personal representative decides to distribute the estate in cash, he or she can list the real estate with a broker or sell the property to a real estate investor.

The personal representative may sell or transfer the deceased’s real estate only after a legally specified waiting period. He or she may sell or transfer the deceased’s personal property at any time but it will not be seen as the final distribution of property until after a waiting period specified by state law (eg. six months).

When the waiting period has expired, what remains of the estate may be distributed to the beneficiaries and heirs. The personal representative will make disbursements of cash, send copies of documents such as deeds and investment statements showing new ownership, or transfer property to the respective beneficiaries.

6. Provide a final accounting

This is generally required and is a final settlement of the personal representative’s dealings on behalf of the deceased’s estate. Once the judge approves the final settlement, the personal representative will have no further duties and the estate will no longer exist.

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