Now That You’ve Found a House You Can Call a Home, How Will You Protect It?

November 29th, 2010 at 1:19 pm | Type:

Author: kimandkristine | No Comments

Purchasing a house can be a surprisingly emotional experience, especially for first time buyers. For many people, a house is the largest financial investment they’ll ever make. Yet after taking such a big leap, many homeowners neglect to take the next necessary step to protect their homes.

California law provides that when you die owning assets worth over $100,000, your estate will have to go through probate, which is a court proceeding that determines who inherits your property. The $100,000 threshold is not based on the home’s equity, but rather on the home’s net value, including its mortgage and any other debt. For example, if the net value of your home is $800,000, with equity of $50,000 and mortgage of $750,000, at your death, you will still go through probate, since the value of the home exceeds $100,000.

The problem with probate is that it takes a long time (nine months or more to complete), which delays distribution to your beneficiaries. All the information in your probate file is readily available for public inspection. But worse, probate is very costly. Using the example above, probate fees for an $800,000 home is $38,000, which is most of the home’s equity.

Probate fees and delays can be easily avoided if, during your lifetime, you transfer your home into a revocable living trust. Although you transfer your assets into the trust, you still retain absolute control over them. This means you can sell your home, gift it, change its beneficiaries, in essence, treat the trust property as if you still own it as an individual.

The benefit of placing your assets, including your home, into a revocable trust is that after you die, your estate will avoid probate, your beneficiaries will inherit your assets without court involvement and in a shorter time span. It has taken you so long to find a house you can call a home, protect it by putting it into a revocable trust.

To discuss how transferring your home into a revocable trust can benefit you, contact Tatiyants Law for a Complimentary Consultation: (818) 956-9200 or info@tatiyantslaw.com.

Sona A. Tatiyants is the founding principal of Tatiyants Law (established in 2010). She specializes in estate planning, business transactions, trust administration and probate.

Ms. Tatiyants prides herself on building lasting relationships with her clients and offering a personalized, family-oriented approach to legal services. She understands that each client’s situation is unique and tailors her legal advice to fit a client’s particular needs. As an attorney, Ms. Tatiyants implements sophisticated estate and business planning ideas without the unnecessary hassle and complexity.

Ms. Tatiyants has been a member in good standing with the State Bar of California since 2005. She received her Juris Doctor (JD) Degree from Southwestern University of Law and her Masters of Law in Taxation (LL.M) from Loyola Law School of Los Angeles, where she emphasized her course work on estate planning and taxation.