Is your self-made Will valid?

Dear Len & Rosie,

I have some thought and worries about wills and probate. I have two pieces of property, each valued at $600,000 or so. I made out a will this year, copying most everything from a book at the library. Is my will good? I have enclosed a copy of my will and my property tax bills.

Lester

Dear Lester,

We read the photocopy of the will you sent with your letter. Your will is entirely typewritten, except for your signature at the bottom of the page. It has not been witnessed. This means that your homemade will won’t work. People like you make lawyers a lot of money.

There are two types of wills: attested wills, and holographic wills. Attested, or witnessed wills, are not valid unless the signature of the person making the will is witnessed by two adult witnesses who do not inherit anything under the will.

Holographic wills do not need to be witnessed, but they must be handwritten by the person making the will. California law recognizes holographic wills, because as it is much more difficult to forge an entire handwritten document instead of just an unwitnessed signature.

Even if your will was validly executed, there are other problems with it, too many to go into in this space. We are also sure that you do not want all of our readers looking at your will. However, your will raises an important issue. Your will doesn’t give away your entire estate. There are a number of specified gifts, but there’s no “residue” clause giving away what’s left, if anything, after the specific gifts are fulfilled.

There is one saving grace. Your real estate is titled in joint tenancy with your wife, according to the property tax bills you sent us. When one of you dies, the surviving spouse will own both properties without going through probate.

If you make your own will, you are taking a big risk. Wills are very formal instruments and must be properly executed to be valid. It is very easy to make mistakes in drafting wills. Look at what you did. You do not want your loved ones to have problems probating your estate just because you wanted to save a few bucks. Wills are also cheap, and your attorney will even keep your wills for safekeeping for no charge, just on the chance he or she will pick up an nice fat probate after you die.

You should see an estate planning attorney about making a new will, and you should also consider a revocable trust. Probate will take more time and cost more money than it would to administer a trust after your death. The statutory attorney fees on your real property would be $25,000, and that does not count the rest of the assets you own.

Len & Rosie

Should mother declare bankruptcy over mounting credit card debt?

Dear Len & Rosie,

My mother is 75 years old and receives SSI. She has somehow managed to incur $15,000 of credit card debt. Every time she received something in the mail offering her a good deal she’d sign the pre-approved application and a few weeks later she’d have another credit card. I finally put a stop to this when I got involved in her finances. My mother owns nothing except for two insurance policies worth $10,000. Should she declare bankruptcy? Can bill collectors demand payment from mom’s insurance money after her death?

Andrea

Dear Andrea,

Your mother can declare bankruptcy if she wants to, but it isn’t really necessary. She owns next to nothing. Since she is on Supplemental Security Income (SSI) from Social Security, the total value of her countable assets has to be less than $2,000. Her life insurance policies are certainly term life policies with no cash surrender value, otherwise she wouldn’t be eligible. Since SSI payments are exempt from attachment, your mother is judgment proof, if only because the consumer lending industry hasn’t yet figured out how to squeeze blood from a turnip.

If your mother’s insurance policies do not nameher children as beneficiaries, then she should change that now. She gets Medi-Cal benefits automatically because she collects SSI. Upon her death, the California Department of Health Care Services will assert a claim against anything she owns in her estate that isn’t spent on her funeral and burial expenses. If the insurance pays into her estate, it will be subject to the Medi-Cal reimbursement claim, and anything left after that will wind up going to your mother’s creditors. You would wind up with nothing for yourself.

If you are the beneficiary of your mother’s life insurance policies, then the money will pass directly to you upon her death. Since the insurance money will not be part of her probate estate, it will not be subject to the claims of her creditors. You will not have to reimburse Medi-Cal either.

You are not legally obligated to pay your mother’s debts, but this will not prevent her creditors from asking you to pay them off after your mother’s death. If they do, mail them a photocopy of your mother’s death certificate with a note telling them that your mother died with no assets and that she was on SSI and Medi-Cal. That should take care of it. If they continue to ask you for money, give them nothing.

Len & Rosie