Setting up a living trust is a good option for those who want to safeguard estate assets and pass them along after death. This strategy helps loved ones avoid having to endure probate and simplifies estate settlement procedures.
As with most estate planning methods, there are advantages and disadvantages of using a living trust. The primary advantage is trust property is exempt from probate which lessens the chance of the Will being contested.
The downside is the time and expense involved with funding the trust. Funding involves transferring ownership of assets to the trust. Any type of titled property has to have a new title issued in the name of the trust. This also holds true for life insurance policies and bank accounts. Orange County Living Trust Attorney – Maitlandlaw.com can plan and create the trust or estate plan that reduces the chances of conflict while distributing your assets after you.
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Furthermore, any time assets are bought, sold, or transferred the trust must be updated to reflect changes. This results in additional filing and document recording fees. With that said, probate costs typically equate to the same or more, yet offer less protection.
The reasons to avoid probate are plentiful. Not only is the process costly and time-consuming, but estate assets also cannot be transferred to beneficiaries until every aspect of probate is complete. If complications arise that extend the duration of probate it could lead to a depreciation in value.
Another concern is that family members can contest a probated Will and lay claim to assets which were not bequeathed to them. This results in having to hire a lawyer to resolve the issue. Since legal expenses are paid by the estate there is potential for a forced sale to cover costs associated with litigation.