It's a word you may have heard before but may not fully understand what it means or why it's important to your estate plan. While North Carolina does not compare to states like New York and California when it comes to probate difficulty, the logistics of the probate process may make it worth avoiding, depending on your wishes and goals for your family and asset succession.
Probate is the process by which legal title to your assets is changed and given to your beneficiaries - either those set out in your will or those who would benefit from your estate through intestacy if you have no plan. The Clerk of Court in your county of residence (not where you die - but where you lived and intended to remain at the time of your death) has the exclusive jurisdiction over the probate process. What makes probate worth avoiding is the timing and burden it imposes on a loved-one's family.
The estate administration/probate process will generally take, from open to close, 8-12 months on average. That's not from date of death; it's from the date the estate is opened with the Clerk's office. Sometimes it takes weeks or months to even get the estate opened, depending on how the person died, how easy it is to find the decedent's documents, and the proximity of the family.
Probate follows the passing of a loved one. So, not only are you having to deal with the death and it's significant emotional and mental impact on the family, you also have to navigate the court process to distribute assets and wrap of the decedent's affairs. On top of that, whoever is appointed to be the executor will have to take time away from their family and work to create and file the required forms and filings to move the ball forward through the process. Often, attorneys will be hired to help with that process.
The costs of probate come in a couple of different forms: 1) court fees, and 2) attorneys' fees. Court fees include the filing fees to create the estate ($120) and the probate fee that is taxed against the personal property assets of the estate (0.4% of the value of the personal property assets in the estate, with a minimum fee of $15 and a maximum fee of $6,000). There are also other miscellaneous costs of administration, like legal classified fees for the Notice to Creditors. While attorneys' fees are not required - obviously the executor is free to handle the estate him- or herself - but generally most estates of any significant value will utilize the services of an experience North Carolina probate lawyer. Those fees will generally run between $2,000 and $10,000 depending on the size of the estate, and the nature of the assets and claims against the estate. Most lawyers perform that work on an hourly rate.
While the probate process can certainly be navigated with some diligence and persistence, the above issues should still be considered when creating and implementing an overall estate plan of any kind. Avoiding probate generally requires using trusts or turning probate assets into non-probate assets. The process that requires will be different for every family.
If you're interested in discussing your options for avoiding probate in North Carolina, contact an experience North Carolina probate lawyer.