COVID-19 Makes Revocable Living Trusts More Attractive
New Jersey has 21 counties, and the courthouses in all of them closed during the COVID-19 lockdown. Since probate depends entirely on the court, estate owners should opt for a process that eliminates the need for judges to supervise the distribution of assets. That’s why a revocable living trust could be perfect for your estate plan.
Estates in Probate Are Delayed Right Now
Probate—the judicial process whereby a will is accepted as a valid last testament—requires the court’s attention. Notice must be sent out to creditors, and beneficiaries will get their chance to participate in the proceedings.
However, the novel coronavirus pandemic led to courthouse closings throughout New Jersey and the entire country. When courts are hearing matters, they are only focusing on emergencies. Nonessential litigation is on hold. Even when litigation is proceeding, judges are hearing motions and arguments remotely and over the phone.
Probate is not considered to be a proceeding of the highest importance. While it is critical for many families who want to receive their money, courts do not view this as an emergency. This has shown families more than ever that the need to avoid probate is great. Not only does probate cause delays, but the system could also be slowed down once the courts start working their way through the backlog.
Given the severe impact that COVID-19 had on New Jersey, it may take courts in the state even longer to catch up on their caseloads. This means that, for the foreseeable future in New Jersey, assets titled in a deceased’s name are stuck.
Revocable Living Trusts Keep Estates Out of Probate
The foremost way that people can avoid probate court is by a revocable living trust. This document has many of the same features as a will. However, when you have a trust, you can avoid probate because the terms of the trust remain in effect after the person dies.
The great thing about a revocable trust is that the trust governs even after the grantor passes away. There is no need for probate because the trust instrument dictates how the property will be passed.
The revocable trust practically eliminates the need for any state oversight of the property. The trustee is governed by their fiduciary duties as opposed to being subject to the supervision of the court. This is even more valuable when the state is not able to supervise, which will cause interested parties to have to wait out the delays.
Saving time and money is an important consideration during this difficult time. While you may think that trusts are more expensive than wills, you are now seeing some of the hidden costs of a will. When you have a will, it will be uncertain when beneficiaries can inherit their property. If anything, COVID-19 underscores that wills are not always as easy as we think.
The great thing about a revocable living trust is that it is changeable. You may think that you cannot change an established trust. This is the case with irrevocable documents, but those are primarily the trusts you use to allow a loved one to access long-term care through Medicaid. A revocable trust is changeable at any time so long as the grantor is of sound mind and not under undue influence.
One popular version of a revocable trust is a “pour-over will.” With this instrument, if property is not specifically funded to the trust during the grantor’s lifetime, it will be automatically left to the trust once the creator passes.
In a COVID-19 world, convenience is of the essence, and anything that takes time may result in further delays because the courts could be unpredictable for some time to come. Thus, you may want to invest some extra time and money right now into retaining an estate planning lawyer so you can circumvent the courts as much as possible.
To learn more about revocable trusts, turn to an estate planning lawyer at the Knee Law Firm in Hackensack. Contact us today at (201) 996-1200 to learn more.