So, on top of mourning the loss of a parent, you also discovered that they failed to do an estate plan.  Or, you may have found out they never transferred property into their trust or did not do so correctly.  Your first thought might be that everything must go through probate.  But fear not!  Here are some options for transferring assets to their intended recipients after the owner has died without going through probate.

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Vesting on Real Property (A House)

For real property, there are magic words that can avoid probate: "with rights of survivorship."  In California, multiple owners can share title to property with different vesting options.  The vesting specifies what rights each owner has.  Two of these options have a built-in, automatic, basically-magic way of avoiding probate.  If your loved one owned property with a joint owner and held title as "joint tenants" (also called "joint tenants with rights of survivorship") or "community property with rights of survivorship," the property might be able to avoid probate.

Here's what happens: when joint owners hold title with rights of survivorship, and one dies, the other owner(s) immediately absorb that deceased owner's interest.  For example, Alex, Brittany, and Carlos own real property as follows: "Alex Applebottom, Brittany Bacon, and Carlos Cooper, as joint tenants."  If Carlos dies, his 1/3 interest in the property immediately gets absorbed by Alex Applebottom and Brittany Bacon, meaning they now own the property 50/50.  There is no need for probate at all!

As another example, imagine Harry and Wanda, husband and wife, own property as follows: "Harry Jones and Wanda Jones, as husband and wife, as community property with rights of survivorship."  If Harry dies, Wanda immediately becomes the sole owner: like magic! No court, probate, or headache required.

There are however some simple items that need to be filed and recorded with the County, but that is a whole lot easier, cheaper, and quicker than going through probate.

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Joint Ownership, Transfer on Death or Beneficiary Designations (For Bank Accounts or Investment Accounts)

The easiest way to get a bank account and some investment accounts transferred to a new person is to add them as a joint owner during life.  If one of the joint owners dies, the surviving owner most often will simply absorb the other interest (just like the right of survivorship!).

Alternatively, for bank accounts and certain types of investment accounts, including some retirement accounts, the owner can specify who should receive the asset upon the owner's death.  For bank accounts, these are often called a transfer on death or pay on death designation.  Finding this out can be as simple as a phone call to the bank manager to check what is listed on the account.  If the bank has been previously instructed to pay to another person on the original owner's death, the bank will just need a death certificate, and *presto!* Transferred.

For investment accounts, including some retirement accounts, there may be beneficiary designations, similar to a transfer on death designation.  This is basically a contractual agreement that the holder of the account will transfer a death benefit to a specific person or people (like a surviving spouse or children) which does not require any court intervention!

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Small Estate Affidavit (Personal Property Under $184,500)

Fortunately, the California Probate Code allows for transfers of personal property  if the decedent's total probate estate is under $184,500.  This is done through a "small estate affidavit" under California Probate Code section 13100.

To accomplish this, the successor (person entitled to the property) simply needs to send a declaration to the company or person holding the property with all information required under the Probate Code.  Notably, this declaration must be made under penalty of perjury and notarized.  However, if all the information is presented correctly, the company is almost sure to comply and hand over the assets.

Why would they comply?  The California Probate Code goes on to state under section 13105 that a holder of property who refuses to comply with a valid small estate affidavit can be liable for attorney's fees and costs of any resulting litigation.  Most often, this downside provides all the incentive necessary for the holder to comply!

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Spousal Property Petition (Surviving Spouse)

Some of these options do involve court intervention, but are much easier (cheaper and quicker) than a full blown probate.  For a surviving spouse of a decedent, one such option is a spousal property petition.

In a spousal property petition, a surviving spouse lays out the facts proving that assets would pass to them if a full probate occurred.  Then, if the Court agrees, the assets are transferred to (or simply confirmed owned by) the surviving spouse.  Often, these spousal property petitions will take three or so months, but that is about a quarter of the time a probate typically takes.  The lesser of two evils, indeed!'

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Heggstad Petition  (Assets Left out of Trust)

Finally, if an asset that was supposed to be an asset of a trust was never correctly transferred, or if it was transferred out and never put back in the trust (think refinancing a home), then the Court might be able to help get the asset back in the trust without a full probate.  Under a very favorable case for California residents, the Court decided that a party's intent to hold an asset in the trust is sufficient to order the asset a part of the trust.  The most common way this is achieved is by showing the court that the asset was listed on a schedule purporting to show all trust property.  However, there are many, many scenarios that satisfy a Heggstad petition.  If there is no objection, courts love granting Heggstad petitions because it is such a timesaver for everyone involved-judges included!

These are just some of the ways to transfer an asset if a loved one dies without an estate plan, but attorneys at Finlay Law Group, APC can help you determine what options are available.  Reach out today for a free consultation.

Disclaimer: The above information is intended for information purposes alone and is not intended as legal advice. Please consult with counsel before taking any steps in reliance on any of the information contained herein.