E571 1. Why some persons create Trusts in addition to Wills, 2 Next YouTube videos.
Why some persons create Trusts in addition to Wills
Probate is defined as the procedure by which an Executor proceeds to admit a Will to the jurisdiction of the Surrogate Court, which is proved to be valid or invalid. The term generally includes all matters relating to the administration of estates.
New Jersey is a probate easy state. Very few persons in NJ really need a $4,000 Revocable or Irrevocable Trust for their estate. For most NJ citizen, a $500 Will is best for them.
There are instances where Surrogate Court monitoring of the estate is desirable. Much has been written about the disadvantages of probate.
Following are just a few of the problems associated with probate.
Lack Of Privacy
Documents filed with the Surrogate Court are public information. They are available for inspection to anyone who asks. In large estates, which require an accounting, your probate file will contain a complete list of all assets devised by your Will including business assets. This lack of privacy may lead to problems among family members who now know the plan of distribution and may then contest any provisions with which they disagree. Disinherited relatives and creditors are notified and given time by the Court to contest the Will distribution.
The probate of an estate may take several months to several years to complete. During that time family members may have to apply to the Surrogate Court for an allowance.
WHY SOME PEOPLE SPEND OVER $3,500 TO CREATE REVOCABLE LIVING TRUSTS
Fragmentation - Real Estate
If you own real property in more than one state, probate rules must be followed in each state in which real property is located. The cost and time may be increased.
A Revocable Living Trust is a legal device that allows you to maintain complete control over your assets and AVOIDS PROBATE. Because there is no probate of a Living Trust, your private financial matters remain private; there are no probate costs, no long delays and loss of control, and no fragmentation of the estate. However, there is no Medicaid benefit or tax benefit with a revocable trust
You Maintain Complete Control Over Your Property In Trust If Revocable
The principle behind a Revocable Living Trust is simple. When you establish a Living Trust, you transfer all your property into the Trust, and then name yourself as trustee, or you can name you and your spouse as co-trustees of the Trust.
The trustees maintain complete control over the property, the same control you had before your property was placed in trust You can buy, sell, borrow, pledge, or collateralize the trust property. You can even discontinue the Trust if you choose. That is why it is called a "Revocable" Living Trust. We will explain the "Irrevocable Trust" at the end of the article.
Transferring Property Into The Trust
Anywhere you have assets, you will need help in transferring your property into the Trust. Your attorney, securities investor, etc., will provide you with assistance needed to transfer your property into your Revocable Living Trust. Your attorney will need to prepare new deeds, affidavit of title and other legal documents to transfer ownership of real estate in NJ.
Probate records are public; your
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