Nichole Y. Shafer
Guest Columnist
In past weeks this weekly column has written about why you want to own your real estate until you pass away and the potential downfalls if you give your real estate to your kids before your death.
However, there are also several potential downsides to sitting tight and doing “nothing” with your real estate, i.e. if you do not make a plan for what should happen to your real estate upon your death.
If you do not make a plan for your real estate to be transferred to an individual, entity, or trust upon your death then it is likely your real estate will be going through probate in Ohio.
Probate is the court-supervised process of transferring a deceased person’s assets. The probate process will either transfer the assets through the decedent’s will if they have one or through intestacy if the person dies without a will.
The main reasons people try to avoid taking real estate through probate is largely due to the time, cost, privacy, and stress that tend to come with the probate process.
What do I mean by time? Well, the probate process can take many months or even years to complete. This tends to cause a delay in the distribution of assets to the beneficiaries. This also means the real estate cannot be transferred to the beneficiaries immediately after a person’s death. In most instances, this delay is unwelcome as the beneficiaries do not want to pay for the property taxes, utilities, property insurance, and upkeep of the real estate.
In addition to the probate price being potentially timely, it can also be expensive. The probate process can be expensive, due to the fees for the court, attorneys, executors, and appraisals. These fees add up and can ultimately reduce the value of the estate, leaving less for the intended beneficiaries.
Another downfall to taking real estate through probate is the lack of privacy that comes with the probate process. Probate records are public, which means that personal and family information can become public record. This can be avoided if a person makes a plan for their real estate prior to their death.
Additionally, probate can be stressful for beneficiaries and executors, especially if they are unfamiliar with the process. This added stress comes at a time when there is typically grief and a lot of change happening in the family. Thus, most people want to try and take the added stress off of their family as much as possible.
Examples of common plans that are used for real estate that can avoid probate include but are not limited to transfer on death designations, survivorship language, entities, and trusts.
In order to avoid the time, expense, stress, and lack of privacy that comes with taking real estate through probate you are encouraged to consult with your attorney about what you can do to make a plan for your real estate.
Nichole Y. Shafer is an Ohio-licensed attorney at Schroeder Law LTD in Putnam County. She limits her practice to business, real estate, estate planning and agriculture issues in northwest Ohio. She can be reached at [email protected] or at 419-659-2058. This article is not intended to serve as legal advice, and specific advice should be sought from the licensed attorney of your choice based upon the specific facts and circumstances that you face.
