There are several important reasons you may wish to avoid probate. First, it is expensive. The fee for probate is set by statute in California. For ordinary services, the executor and attorney each are entitled to compensation based on the total appraised value of the estate (before subtracting debts) as follows:


Four percent (4%) on the first $100,000
Three percent (3%) on the next $100,000
Two percent (2%) on the next $800,000
One percent (1%) on the next $9,000,000
One half percent (1/2%) on the next $25,000,000

IT IS IMPORTANT TO REALIZE THAT THE FEES FOR PROBATE ARE CALCULATED BASED ON THE GROSS VALUE OF THE ESTATE, REGARDLESS OF MORTGAGES OR OTHER DEBTS OWED.


The following example illustrates the potentially disastrous effect of probate:

Greg B. bought a house valued at $200,000 and paid a $25,000 down payment. He then died. Although he owned only $25,000 of the house, probate fees were calculated based on the value of the property. Greg's estate owed the executor $7,000 and the probate attorney $7,000, for a total of $14,000 in probate fees!


A second reason to avoid probate is that it often ties up your assets for a long time. While the estate is going through the probate process, a lack of liquidity (cash flow) can create problems for your heirs. They may have to pay your mortgage or other debts, or they may be trying to keep your business running. They will need ready cash, but it can be very difficult to sell assets before the probate is complete. An average probate can take 6 to 12 months, resulting in severe financial problems for your family or business.


Third, the probate process can involve many visits, letters, and phone calls between the attorney and the executor, and can place a physical and emotional burden on the survivors. The grieving process is difficult enough without the bother and disturbance that is often involved in probating an estate. Most people would prefer to have their loved ones remember the good times they spent together, rather than sitting in an attorney's office.