Everyone wants to avoid probate.  This causes people to do all kinds of things in the name of avoiding probate.  For example, some people will give away assets.  Others will put a child on an asset with them.  Both of these “solutions” lead to their own problems which are often much worse than the cost of probate.

Penny wise; pound foolish.  Estate planning is different than most other things in that frequently the results are not measured until after death.  It therefore leads people to try to save money.  There is now a movement for California to join 9 other states and make legal a means to avoid probate.  There is a bill, AB 250, that would create the revocable transfer on death (“TOD”) deed for real property. 

Like everything else, there can be problems.  One is leaving minors as beneficiaries.  In the event that you pass, then there will probably be more administration and court proceedings than under a simple probate.  Certainly a living trust would have been much better.

How about when you leave more than one beneficiary?  Now there are multiple owners of the property.  This may sound good until you actual think about the practical circumstances.  What if one party wants to sell and the others do not?  Ideally there would be a buyout, but what if they cannot agree on price.

What if one beneficiary is deceased?  Now his/her estate is an owner?  There may have to be a probate of the beneficiary’s estate before anything can be done.

What if there is fraud involved?  Undue influence?  In my practice, I frequently see senior citizens do things that they would not have done years earlier.  They are more susceptible to being manipulated.

Frequently, the biggest winners in these attempts to avoid attorneys are lawyers themselves!  That is because, it is much more expensive to litigate than it simply would have been to prepare a living trust.  Frequently instead on there being one attorney in drafting a living trust, there are two are more attorneys.  Unfortunately by the time there are problems, the person who executed the deed, is either incompetent or deceased, so he or she never sees the problems.

Penny wise, pound foolish.  Do not let that be you.  See an experienced California estate planning attorney.  In the event that you are in Southern California, we are available to assist.