DEAR BOB: My husband died last March. He held title to our house in fee simple. But he didn’t have a will. After I got over the shock of his unexpected death at age 49, my high-school-age son told me I had to probate my husband’s estate to get title to the house. He said he learned about this in his “Business Law” high school class. I then consulted a lawyer recommended by a friend. Because my husband didn’t leave a will, he said the estate had to go through local probate court. Although the estate was quite simple, except for a business my husband co-owned with his partner, all went smoothly. I just received the title to my house. But all the legal fees cost almost $7,500 for a relatively small estate worth less than $700,000. Do you think I was “ripped off” by the lawyer? – Sally W.

DEAR SALLY: Your situation provides a valuable but expensive lesson. With simple estate planning, the expense and inconvenience of probate court costs and delays could have been completely avoided.

Purchase Bob Bruss reports online.

But legal fees of $7,500 for a $700,000 estate are not unreasonable. Your state’s estate probate fees probably allow for even higher fees. But most probate lawyers don’t charge the maximum allowed because they know other attorneys will agree to charge less.

If you and your husband had a revocable living trust, or if you held title to your home in a joint tenancy with right of survivorship, probate court delays and costs for the residence could have been completely avoided.

Your late husband and his business partner should have had a buy-out agreement, funded by life insurance, for each other’s interests. I presume resolving the business situation was the bulk of the lawyer’s quite reasonable fee. It’s time to move on and be satisfied you weren’t ripped off by the probate attorney.


DEAR BOB: I am interested in buying a brand-new home and then selling it after completion (presumably for a higher price). But the home builder selling homes in a new subdivision, which I think will greatly appreciate in market value, refuses to sell to investors. His sales contract says the buyer cannot sell within three years after purchase. Is this legal? – Henry T.

DEAR HENRY: Many developers and home builders include such clauses in their sales contracts to discourage speculators like you. Whether such clauses can be enforced by the developer or builder after the sale is completed and title is transferred to the buyer is undetermined.

I am not aware of any appellate court decision enforcing such a prohibition against new home resale. However, an anti-assignment clause in the sales contract would be clearly enforceable. For more details, please consult a local real estate attorney.


DEAR BOB: I own my home, no mortgage. Does my home have to be in a living trust to avoid probate? My entire estate does not exceed $600,000. If my house is in a trust, can my son who has my power of attorney sell it to pay for my future medical care? – Wilma B.

DEAR WILMA: Although your son has your power to attorney, when you die it automatically expires. My experience has been some title insurers refuse to accept a power of attorney if the living grantor has become incompetent.

The best ways to avoid probate are (1) hold title in a revocable living trust or (2) hold title in joint tenancy with right of survivorship with the person you want to receive your real estate.

Holding title in a revocable living trust has many advantages. But I can’t think of any disadvantages. Some folks say the cost of up to $1,000 (more if you have a complicated situation) is too much. But that is far less than the costs your heirs will pay if your assets must go through probate court.

Joint tenancy with right of survivorship works well to avoid probate when you have cooperative heirs you trust. However, there are possible drawbacks such as (1) your joint tenant gets into financial trouble and his creditors attach the property, or (2) you decide to sell but your joint tenant refuses to sell unless you pay him off. For full details, please consult your attorney.

The new Robert Bruss special report, “2005 Realty Tax Tips: 8 Chapters of Tax Savings for Homeowners and Investors,” is now available for $4 from Robert Bruss, 251 Park Road, Burlingame, CA 94010 or by credit card at 1-800-736-1736 or instant Internet download at Questions for this column are welcome at either address.

(For more information on Bob Bruss publications, visit his
Real Estate Center


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