Most people would say there are essentially two categories of probate – formal and informal. I think that is a bit overly simplistic. In reality there are several, for example, there is transfer by affidavit, informal probate, formal supervised probate, and formal unsupervised probate. In the next few blog posts we're going to look at each of them in detail. Today, we're going to tackle transfer by affidavit.
What is Transfer by Affidavit?
Transfer by Affidavit is a procedure whereby small estates can be distributed without probate procedures. There doesn't need to be a personal representative appointed, and there need not be any notice to interested parties. It is appropriate for estates with a net value of under $75,000 with no real estate. The goal is to provide a simple alternative to probate where only basic transfer is involved.
In a transfer by affidavit scenario, a person will execute an Affidavit for Collection of Personal Property. This is done instead of starting a probate. The affidavit must state, among other things, the following:
- Value of the entire estate and that it does not exceed $75,000.
- 30 days have passed since death.
- No attempt to appoint a personal representative is pending or has been granted.
- If presented to a financial institution with a joint account in which the decedent had an interest, then an estimation of how much of the account is property of the decedent.
- A statement that the affiant or successor is entitled to payment or delivery of the property.
What Does the Affidavit Do?
With the affidavit, the law provides that delivery must be made “to the person claiming to be the successor of the decedent.” Minn. Stat. § 524.3-1201. The person distributing the property need not inquire into the proof of any statement on the Affidavit. However, the successor must provide a certified copy of the death certificate in addition to the Affidavit.
Beware, the Transfer by Affidavit procedure does not defeat creditor claims to the estate. A decedent's property is taken subject to all valid claims that may be made against the assets. This includes creditor claims and allowances by surviving spouses and dependent children, or other rights that may be held.
What is a Scenario in which Transfer by Affidavit is Used?
I am commonly called by clients who are the children of a decedent and merely need access to the bank accounts. There is not a lot in the estate, and all they need to do is access the funds to pay ongoing bills, such as a mortgage. (The children, mind you, need to be of the age of majority in order to be able to receive the funds, otherwise they will need a guardian or trustee to access the funds.) A full probate can take a long time to accomplish. And since the estate is small, hiring an attorney for a probate might drain precious funds from the estate. Instead, I have advised them to do a Transfer by Affidavit to access the funds and prepared the forms for them to do so.
If you have an interest in the estate of a person who did not have a large estate, perhaps you can take advantage of this relatively inexpensive and speedy process to resolve the estate. If you want to know more about the transfer by affidavit process, or perhaps need preparing the affidavit, please feel free to contact Signature Law, PLLC for a free consultation.