The Finance Blogger

Real Estate agents! We have a love – hate relationship with them. The really good agents are able to sell our homes for the price we expect or find us the house of our dreams. The not so good agents list our homes for sale and let other agents do all of the work of selling our house. They still collect half of the commission. Agents that we hire to find us a home, show us homes we do not want or cannot afford. Why are they wasting our time? Do any of these statements ring a bell with you? If yes, then you have had some good experiences as well as some bad experiences throughout your life with Real Estate agents.

Real Estate Agents Commissions

Real Estate agents all charge a commission. Typically it is around 6%, with 3% going to the listing agent and 3% going to the selling agent. These 3% splits are further broken down to a split between the agent and their office that they work out of. The split depends on the agents deal with the office and how many sales he or she brings in every year.

Listing Your Home with Real Estate Agents

The agent you hire is supposed to be working for you to help sell your home. He or she does not get paid unless your home sells. The bad agents are going to urge you to list your home for a low price so that it sells quickly and they collect their commission.  The really good agents, who will be around for a long time and have excellent reviews will work with you to find the right price and will be able to demonstrate to you why the price they recommend is the right price based on previous listings in your area and the current market.

It pays to shop around. Don’t be intimidated. Ask for references and check out the references. Ask detailed questions. Find out exactly what they will do for you and how will they market your home. Ask for at least three quotes before you make a decision.

This may seem like a lot of work, however it might mean the difference of several thousand dollars in your pocket and a house that sells in a reasonable time to the right buyer.

Using Real Estate Agents to Find you a Home

With today’s online services, MLS, Grapevine and private sales, there is a huge opportunity for an individual to gather all of the information he or she needs to find the home of their dreams.  Your Real Estate agent can help you with this search, identifying homes that are not yet on MLS which may meet your requirements. They can also arrange for viewings of homes that have been listed by them or other agents. This is an invaluable service, but there is a lot more.

If this your first home, you may need more help than you realize. If you have a good agent , he or she will coach you through the offer process. You may save several thousand dollars by making an offer that is reasonable, but below that of the advertised sale price. But more important , are the conditions that everyone should consider.

Adding in conditions which protects you the buyer and allows you to check for various things before you firm up the deal and become committed to buying a home you may not want. This is one of the most important aspects of an agents job and it may save you thousands of dollars.

Some Conditions to Consider

Financing –  Allows you to firm up financing before you are committed

Conditional Sale – Allows you to sell another home before you are committed and avoids the buyer from owning two homes at the same time

Inspection – Conditional until a home inspector has completed his review and prepared a report for you.

Repairs – specific repairs that may need to be completed prior to final sale

Specific Items – to be included in the sale of the home. A list may be included.

Vacancy – if the home is rented, specifies that the tenant must vacate the home by a specific date.

Condo Report – specifies that the buyer can review the condo documents

Any or all of these conditions may be applied to any offer to purchase. They are designed to protect you the buyer and avoid getting into deals that you really want to avoid. This is not a complete list. There may be other items that are specific to each deal that is put together for you by your Real Estate agent.

Cost of Selling Your Home

If your Real Estate agent has a 6% commission rate and your home is worth $300k, then the commission will be $18,ooo dollars. This is a lot of money and you will want to make sure you get your money’s worth. Legal fee’s will vary. But should be under $1000 and incidentals should also be under $300 and these are high numbers.

Your moving costs will be higher depending on how much you have to move and were you are moving to. Hiring a moving company will be far the largest expense.

Grapevine is another approach to use. Essentially they will take pictures and list your home for sale on their network over the internet. Costs vary, but generally are under $1000 for the service. Customers of Grapevine are prepared to sell their own home and show their home to prospective clients. Not everyone is comfortable doing this and some people are just not good at it. Make your decision carefully before you leap into selling you own home yourself. Some people would rather let the Real Estate agent do the leg work and the commission is more than worth it to them.

I have always found that real estate closings are a stressful event. You are down to the wire and about to purchase a new home or rental property. Your wondering what will go wrong to prevent the deal from going though. There seems to be so many moving parts that you just feel that something will be missed. The whole thing may fall apart.

In reality, if  everyone has done their part ahead of time. There is little likely hood of the deal falling through at the last minute. If there is a problem with the real estate deal then you already know that the real estate closing is in jeopardy of falling apart. Lets examine the roles of each of the participants to see what is involved and what you should look for. Each participant has a role and it is important to know who they are.  You have the seller, the buyer, the sellers agent, the buyers agent, the sellers lawyer, the buyers lawyer, the sellers bank, the buyers bank and the buyers home inspector.

Rolls in Real Estate Closings

Buyers Home Inspector – Completes a home inspection and provides a report to the buyers agent and the buyer.

Seller – Once the offer is accepted, there is not much for the seller to do. Other than be available to sign all of the appropriate documents. They also need to provide the necessary information to the sellers lawyer so they can complete the deal. This includes current mortgage information, other lien information if it exists, tax statement. The keys so that they can be handed over once the deal is completed.

Buyer – The buyer must waive all conditions for the real estate deal to be able to close. If they do not waive the conditions, the real estate closing cannot proceed until they are dealt with. Usually all four people must get involved to make this happen if there is a disagreement i.e. the seller , the buyer, the sellers agent and the buyers agent. Once all of the conditions are waived the buyer must provide to his lawyer all bank information so that the mortgage can be placed, and he must provide the funds necessary to make the down payment. The buyers agent is usually on top of this and will raise a red flag if the real estate closing is in jeopardy.

The buyer needs to meet with his lawyer to sign all documents and receive the keys once the deal is completed.

Sellers Agent

A good agent who is working for the seller will often need to review any offers that come in. They should pre-qualify the buyer through the buyers agent as best he can. If there is a tenant involved the sellers agent must give notice to the tenant. Especially if the buyer will be moving in to the unit. The sellers agent is usually quite motivated to make sure the deal goes through. After all conditions have been waived and will follow up at appropriate intervals to confirm that the deal is still good.

Buyers Agent – his job is to protect the buyer and to put together an offer that is best for the buyer. If there are conditions, the buyers agent should work with the buyer to help arrange for these items to be waived. So that the real estate closing can take place. He will follow up with the lawyers on both sides and the sellers agent to confirm that there are not outstanding issues.

Lawyers and Banks

Sellers Lawyer – using the proceeds of the sale the sellers lawyer needs to pay out the bank mortgage of the seller. They will de-register the mortgage against the property. He will also provide the final adjustments to the buyers lawyer. Items such as taxes, condo fee’s etc are included and accounted for. Once all documents have been cleared, money received and paid, his costs calculated, the sellers lawyer will transfer the remaining funds to the appropriate bank as designated by the seller.

Buyers Lawyer – the buyers lawyer must receive the funds from the buyer and the buyers bank. Then they register the mortgage and have all documents signed. They prepare a statement of account and remit the proceeds to the sellers lawyer. He must also confirm there are no new issues that could prevent the deal from proceeding. As well as that all conditions are fully waived.

Sellers Bank

Not much for the bank to do here other than provide a statement of the balance to be paid out on the date of the real estate closing. Once they receive the funds, they will discharge the mortgage and update their books.

Buyers Bank- They will need to have pre-approved the buyer for the mortgage. Assuming that this is done well in advance there should be no issue. However some deals do fall through because the buyer was not properly pre-approved. On the day of the real estate closing, the bank will forward the funds agreed to, to the buyers lawyer. Who in turn will complete his work as stated earlier and then forward the proceeds to the sellers lawyer.

Sounds complicated, however as we said earlier, if all of this work is done in advance and the agents are managing the deal. Then there should be no problems for the real estate closing. If you are concerned, meet in advance with your lawyer and go over all details.

Sellers hate them and buyers have a love / hate attitude towards home inspections. Home inspections are an excellent addition to the real estate business over the last few years. They really do help the industry at large and even sellers deep down can appreciate their value in many situations. Sellers don’t like them because they are afraid they will identify major issues that could jeopardize the sale. Often there are surprises that the seller is not even aware of, which can save the buyer thousands of dollars.

Buyers  have a love / hate attitude home inspectors.  Consumers like the idea that the home inspector will identify issues that can save them money. Also identify issues that they need to focus on in terms of renegotiating their offer. Buyers who are emotionally attached to the house they are looking to buy, are afraid that the home inspector will identify issues that could break the deal. They understand it is for the best for them. However they would really prefer that the home inspector does not find anything. In addition that the deal will proceed as offered.

Home Inspections – What is the Process

You are ready to make an offer on an existing home and your real estate agent is talking about conditions that you need to add to the offer. Come on you just want to get on with the deal and buy this house. You are hoping that the seller will accept your offer so that you can move into the house of your dreams!

Well you should listen to your real estate agent. He or she is doing his job of protecting you against making a bad deal. One of the conditions he or she should be adding to the offer to purchase is the plan to ask for a home inspection that will be completed by a home inspector at your cost. You are already spending enough money and now you have to shell out more to pay for a home inspection! The answer is yes and you should.

Save Money

Numerous buyers have been saved thousands of dollars by getting home inspections completed. The inspector may find issues with the home which might cause you to walk away from the deal or they might allow you to negotiate a better price.

The process is that you make an offer with a home inspection as one of the conditions. The home inspector goes into the home you are intending to buy, completes the inspection and provides a copy of the report  to you and your agent for review. If issues are found, he will hi-light these items and it is up to you how to handle them. Your agent wants to see you protected, while at the same time he does not want to lose the deal. Most likely he will try to seek a middle ground to have the buyer and seller absorb some of the costs associated with what ever issue the home inspector has found.

Now you get to negotiate with the buyer regarding who will pay to fix the problems and ultimately it comes down to how much you want this particular house vs. the cost to fix whatever problems he might have identified.

What Kinds if Issues Might an Inspector Identify

A good inspector is going to check everything associated with the house. He will include the foundation, the construction, wear and tear on the building. Also any areas that might cost you money in the foreseeable future. The condition of the roof, the siding, the windows, the insulation, the wiring, the furnace, the air conditioning and much more. While you are caught up in the emotion of buying a new home, the home inspector will conduct his review in a business like manner. He should also prepare a report for you to review.

For example, he may review the condition of the roof and conclude that you will need to replace the roof in five to 10 years time. He might note if there are any serious issues with the roof at this time. This information is crucial, since now you know that you can expect a large expense in 5 to 10 years time when you replace the roof. This is an example of how one are might be identified. He will also tell you for example that  the furnace is ok or it is on its last legs. If it is on its last legs you can try to negotiate a lower price for the home to cover the cost of the furnace replacement. A home inspector can save you thousands of dollars.

Next Steps after You Receive the Home Inspection

Once you have received the home inspectors report, your next step is to either accept the results and waive the conditions. Or walk away from the deal or try to negotiate a revision to the original offer you made. A reduction in price would help pay for some of the repairs that you will need to make. This is were the value of a home inspector really comes in and saves you potentially thousands of dollars.

Once you have agreed to waive the conditions or have negotiated a final deal, the next step is to close the deal. Accept the keys along with the debt  etc. Your home inspectors report is an excellent guide to the maintenance that you are going to have to do. Also a useful planning tool to help you plan financially for all of the repairs and / or upgrades that are needed. Some of these conditions that you have absorbed can be worked into the mortgage financing. However it will take a creative real estate agent to assist you with this negotiation.

Once a person has passed away, there are various activities that need to take place to ensure that all of the wishes of the deceased and the family are dealt with. There is a funeral to arrange, notification of family members, assignment of an executor to manage the estate. They need to arrange to continue payment of all bills including utilities while the estate is being wound up. All of this needs to be done in stages during a time when everyone is stressed out. They are grieving for a family member who has passed away. The potential for conflict and generating bad feelings among family members is high.

Will Execution & Conflict : Dealing with Grief and Stress

Most people really just want to deal with their grief. They do not want to focus on more business like issues such as reading the will. Or looking after assets such as homes and cars. However it can be important to deal with these sorts of things quickly. Houses must be maintained. Sometimes there is a business that needs to be kept going. People are depending on the business for their jobs. They also need to know what is happening. At the least make an assessment of those items that need a decision and action immediately. Separate those that can wait a few days or weeks before attention is required.

Keeping a level head in these situations. Do not allow the stress of the situation get the best of you is so important. Some times discussions can become heated and cause family rifts when there is really no need. Agree to disagree. Take some time to cool off so you can deal with the situation in a more level headed business like manner.

Reading of the Will

The will should be read fairly soon for most situations. This can occur immediately after the funeral. Especially if there has been good communications with the family ahead of time so that there are no surprises. There may be urgent reasons such as tissue donations, family members traveling, business decisions that need to be addressed. The will may need to be read more quickly prior to the funeral being completed. Someone should peruse the will to determine if there are any instructions in the will regarding the funeral arrangements.

For some, the reading of the will, will be a tense situation. You are crowded into the lawyer’s office or conference room, you are still grieving and there may be some surprises or conflict that you really just do not want to deal with. Spouses of surviving children sometimes also insert themselves into the situation, which is not always the best idea when tension is high.

Unfortunately there is just no way of getting around this step. It must be done and all family members that are mentioned in the will should be in attendance. Typically what happens is that the lawyer will read the will, answer any questions and discuss the steps that need to be taken to execute the will. Everyone should receive a copy of the will and if necessary the death certificate. The executor will be assigned as per the will. Some people ask for more than one executor which is a great idea in many ways, but also is a potential area of conflict if there are disagreements about how the estate should be handled.

Will Execution & Conflict

We have reviewed in another post the duties of the executor in executing the will and the areas that he or she needs to pay attention to. One area that we did not discuss is the personal issues and the management of the relationships among the various family members.

Essentially communications and lots of it are the best approach, however an executor needs to remember that family members deal with grief as well as stress in various ways. Some will handle their grief well, were others will not and react in an emotional manner. The executors role is to manage the closing of the estate and were needed the management of family members who may not totally agree with the will or the way the estate is  being managed. This latter activity is only to allow you to move ahead, finalize the estate and close it as per the instructions in the will.

Generating conflict and creating tension is self defeating and usually ends up costing everyone more money. As an executor all of your actions will come under scrutiny and you may even be called on to produce records of the activities that you have undertaken. This is standard and if you are up front about it, then there should be no problem. Always be prepared to support any decisions you have taken and the reasons why.

Dealing with Conflict

Some recipients of the estate may be jealous of the fact that you are executor, some may feel that you are mot moving quickly enough, some may feel that the will was wrong or not clear enough. Regardless of what is driving the conflict, an executor should call family meetings to discuss the status and provide clarifications regarding the will or the actions they have taken. In some cases you may also require clarification from you lawyer if a legal issue is involved.

Always deal up front and be clear about your intentions. Always take notes and seek agreement to any area of conflict once it has been fully discussed. Everyone will feel better if their concerns have been heard and discussed. They may not be always happy with the answer, however they at least have an answer and understand how it was arrived at. Communicate and communicate some more is the mantra for dealing with  conflict.

In summary, there will be some conflict in every family. Always try to take the high road and ask the question, “How would dad or mom want this handled?” don’t sweat the small stuff!

It is surprising just how much conflict is generated over a will both before someone passes away and after. Families seem to get tied in knots over various issues. All it does is cause bad feelings and / or lost money because it gets tied up in the courts. Wills and family conflict are actually quite common.

The only ones who win in this situation are the lawyers. First we will deal with issues that seem to come up during will preparation. This is  prior to the person preparing the will becoming deceased. Then we will discuss some of the conflict that is generated after the will is read. And executed by the executor in the next post.

Wills and Family Conflict – Family Situations

The simplest case is a situation were the husband wife are planning to pass along their assets to their children. Normally this should be straight forward. However many times it is not. Throughout we will recommend strong communication with all parties. In most cases it is lack of communication and understanding of the participants. Most parents will divide out their assets equally to all surviving children. This tends to be the fairest way to do the distribution and avoid hurt feelings among the children.

Occasionally there will also be one child who has special needs that the parent has been providing for. Parents may ask for special arrangement to be taken to provide support for this child. As a result this child might receive a higher proportionate share of the assets. The value of doing this is it will ensure a better quality of life for someone who cannot take care of themselves. It also decreases the support required by the remaining children which can be significant in some situations.

Competition Among Family Members

There may be some competition between the children regarding heirlooms. Or there may be a misunderstanding regarding who was to receive a particular item. Open discussion, even negotiation between participants usually works well. Sometimes the parents are uncomfortable with this activity. They feel that the children have them one step from the grave and are waiting to pick over what is left. This is just not the case in the vast majority of situations. Our answer to this is would you not prefer to see that your most prized possessions continue to be prized by someone. Also that the right person received it. You can derive a lot of pleasure by bequeathing heirlooms in your will to someone who will take great care of the family heirloom.

Having open discussions and even going as far as to put tags on items or creating a list of all items that you care about with the name of the recipient will help to resolve many areas of conflict. Discuss the list with your children so they know what to expect.

The Other Spouse

Another area causing a lot of concern is the new spouse. As children you have had to deal with the grief of losing a mother or father, then your surviving parent decides to remarry. We have all heard the horror stories were the new will is read, everything goes to the surviving spouse, which is the step parent and nothing to the children. Before you know it many of the treasured memento’s are finding their way to the step parents children or are being sold without any consultation to the original family members.

Open and honest conversation, although difficult is often the best approach to take. Sometimes it needs to be completed carefully and over a period of time to avoid ruffling feathers and causing more conflict. However if you have not had this conversation prior to a new will being drawn up, then you will likely be surprised.

New Will

If a spouse remarries, the previous will is usually null and invalid in many jurisdictions. This may come as a surprise to many people however this is just the way it is done. A new will needs to be written for all of the same reasons that the original was put together. The new will should take into account the needs of the new spouse as well as the needs of children of both souses.

Support for the remaining spouse is a discussion item that should also be considered. No one wants any body to experience any hard ship. While at the same time you do not want anyone to lose their families treasures. We recommend that the new will be created and discussed with all parties. Ensure there are no surprises and there is an opportunity to make adjustments if warranted.

A word of caution is warranted. We are suggesting lots of discussion, even negotiation with regards to the new will and the family members. The best approach is for all family members all to have input to the will preparation, however it is the owner of the will that has the final say with what goes into the will, how it is written, when it is written and how the assets of the state will be distributed. At the end of the day, you may not be totally happy with this approach, but that is and has to be the final way it is done.

Do it the Right Way

Preparing a legal document as important as a will should be completed carefully and accurately. A will after all will communicate how you want your estate wound up and who should receive your assets. Take the time to do it right, try to avoid emotional decisions and try to be fair to all parties. Sometimes a will is used as a weapon from the grave. All it does is cause further grief and anger and most people end up thinking even less of the individual after they have passed away than they did when they were alive.

Our next post is going to discuss family conflict after the will is read and what you can do to deal with this situation.

The role of an executor can be very simple and straight forward for most people, however the more assets there are and different types of assets the more complex it can be. Disposing of homes, rental properties, investments and heirlooms all take different and special skills. In most cases, the executor is a family member. They will work with the family lawyer and the rest of the family to carry out the instructions listed in the will.

Initial considerations for the Role of an Executor

Along with other family members, advise all relatives and then locate and examine the last will. Time may be of the essence, if there is an intention to donate human tissues. Also the executor should begin making decisions regarding the funeral arrangements as required by the instructions in the will and the needs of the family. Arrange a family meeting with the lawyer. Read the will. Follow the instructions given to the executor (s).

There are a number of things such as dealing with the post office to re-direct mail. Advising all family members and people mentioned in the will. Also taking steps as required to protect any assets that now belong to the estate. These can include cash, securities, jewelry, deeds and insurance policies.

Executors should also confirm that there is adequate insurance on homes and cars. If there is a business involved, the executor should oversee the continuation of the business. They need to determine what is required to continue the business on good footing.

The next step is really to prepare for distribution of the assets. But first you must determine what the assets are.

Determination of Estate Assets

The role of an executor includes meeting with the banks and other financial institutions were assets are located. You may need a copy of the will naming you as the executor of the will before they will allow you access to any accounts or safety deposit boxes. Most organizations will make this request and they may also request a copy of the death certificate.

Keep notes on everything and  a diary is probably a good idea to keep everything organized. Date all entries in your diary. Document all decisions. Note who was involved and any concerns or dissensions from the decision.

Make a list of all assets: bank accounts , insurance policies, household contents, personal effects, etc. The executor will also need to list employee benefits, outstanding salary, death benefits, group insurance, pension entitlement, medial and other health insurance benefits. Filings for the CPP benefit if you are in Canada.

The executor must also inspect and obtain professional valuations of any real estate, leases, mortgages, taxes, and businesses owned by the deceased. In some cases you may need three assessments and then average them to obtain the final price.

Dealing with the Court

The lawyer retained by the deceased will assist in this area, however the executor is responsible for overseeing this activity. Depending on the country of residence, you may need to provide the lawyer with copies of the inventory and the value of the inventory. Calculate estate taxes and other fee’s. The legal fee’s may be a fixed amount or it may be a percentage of the assets, It is important to establish this up front with the lawyer to understand what your obligation is in this area from an estate perspective.

Realization of Assets

Deposit all cash to an estate account. Assemble bonds, stocks and similar investments and arrange for sale to convert them into cash. Turn over real estate should to family members as instructed by the will. Also make arrangements for real estate to be sold. Collect rents  as well and deposit in the estate accounts.  Make all Insurance claims. Provide all necessary documentation.

Tax Filing and Executors Role

First,  tax filing should be filed for the last year prior to death up to the date of death. Secondly once the estate is wrapped up an estate tax filing is also required. If it takes several years before all assets are distributed. Multi year estate tax filings may be required.

Request a tax clearance certificate from the CRA or IRS.  The executor is free to distribute the remaining assets to the beneficiaries of the will.

Role of an Executor and a Caution

If the assets are large, sometimes family members are in a hurry to receive their portion of the assets. There are lots of reasons for this, so we will just mention that this occurs. The Executor is responsible for ensuring that the assets distributed according to the will. Pay all income and property taxes.

Sometimes an executor will pay out all of the funds, only to have to request some of the funds to be returned to pay final bills and taxes owed by the deceased. Far better to hold money back, pay the bills and then pay out all final assets to the beneficiaries. The beneficiaries may have spent the money. They may have used the funds to pay off their own debts. Or they may have made investments that make it difficult for them to pay their fair share of the remaining bills. This situation can create a lot of tension and discourse.  Better to deal with it by avoiding the situation in the first place.

The are few times the vast majority of people ever need to contact a lawyer and incur legal expenses. When they purchase a home, sell  a home, prepare a will, or deal with minor traffic infractions. Few of us ever have to worry about a major criminal case, or lawsuit or  major divorce proceedings. Financing Legal Fee’s can be a problem for some.

Selling a home for example can incur legal fees of between $500-$1000. Preparation of  a  will particularly if it is uncomplicated can be in the range of $300-$600. Court cases involving criminal activity or defense of DUI type traffic infractions can cost significantly more and approach $10,000-$100,000. Not everyone can afford to pay these kinds of fees so it is important to understand what the cost will be prior to your case being taken by a lawyer and how you will finance your legal fees.

Financing Legal Fee’s – How Much Will my Defense Cost

Most clients want to know how much their defense will cost when they are facing criminal charges. The answer depends on the circumstances of your case and the quality of the defense team. Most attorneys will be able to provide a quote after initial consultation regarding your situation. There are some points to consider when shopping for an attorney. Here are several questions that you may want to discuss.

Fixed or Variable Costs

Will the price of the case be fixed or will the price increase as the case progresses? Pay-as-you-go contracts can become very expensive particularly if the case lasts a long time. You do not want to find yourself running out of funds in the middle of the criminal process. Competent attorneys should be able to provide a fixed price up front.

Does the Price Include the Trial

Another question to confirm is whether the total price quoted by the attorney includes  the trial process. If your case needs to go to  court and be heard by a judge or jury an extended court case can drive up the costs significantly. Good trial preparation can result in a settlement or even dropping of charges before the case ever goes to court. Skipping proper case preparation to save money might actually cost you more in higher legal fees and in the worst case a guilty verdict.

Hidden Costs

You need to ask your lawyer if there are any hidden costs that you should be aware of. Better to find out before you make the decision to hire instead of when you receive his invoice. Request a full disclosure of all possible costs and legal fees prior to signing an agreement. A good law firm should be able to provide all of the required legal service for a flat fee and then absorb the cost when legal assistance may be needed from other firms. If professional services are required your lawyer is legally required to disclose any fee splits.

Other Expenses

Complex cases often require the use of investigators, psychologists and other non-legal staff. There may be costs associated with obtaining documents, evidence or other records. You need to understand these fees upfront and you should discuss them with your attorney. Experts agree that a good rule of thumb is to estimate about 10% of your legal fees for these outside costs.

Financing Legal Fee’s

There are companies who will provide loans for you to finance your legal fees. Be very careful when negotiating these fees regarding payment terms, interest rates, and other fees that may be included. Legal firms will also sell your legal fees to collection agencies and other firms that specialize in collecting debts. These firms may take a cut of 10 to 12% of your legal fee. So don’t be surprised when the company different than your legal firm comes calling to collect your legal fees.

We are providing this information to assist people in selecting lawyers and understanding how financing of their legal fees will work. You need to take full accountability for hiring a lawyer and negotiating the legal fees prior to entering into an agreement for your defense. These are guidelines only and in no way are providing legal advice. Your comments are welcome.

You have probably heard of wills and have some idea of what a will is, but what on earth is a living will? It is actually a very important document that goes along with your regular will and should be prepared for everyone. Preparing a Living Will is part and parcel to preparing  a regular will.

A living will is a will that provides someone you trust with the authority to look after your affairs while you are still alive and you cannot or are unable to make your own decisions. Living wills can provide a great deal of authority to someone or they can be specifically limited in the power they give to your living will executors. There are two fundamental areas that need to be discussed. One is about making decisions concerning your personal care when you can no longer make those decisions on your own. The other element is all about managing your assets at a time when you cannot make decisions or have got to the point were you would prefer someone else make those complex decisions for you. Both have specific requirements and we will discuss them next.

Preparing a Living Will – Legal Advice

At this point we need to emphasize that the writer is not a lawyer and even if they were, we would still strongly recommend that you consult a lawyer in the city or town were you live. Every country and state will have different legal rules about what can be allowed so it is best to consult with the experts.

Preparing a living will for Personal Care

A personal care living will is all about giving someone specific instructions regarding how you want to be looked after when you are too sick to do so yourself. Perhaps you have had a stroke and need 24 hour care. Who will make the decisions regarding your care? Who will decide were you live? How much money should they spend?Who will decide whether you should be resuscitated or not? What instructions do you want to give your living will executors?

These are the kind of decisions that someone will be faced with. It is often better that you provide clear instructions regarding what you want done. Do not leave people guessing when time is critical. The doctors will usually turn to the family. It is a good idea that everyone should communicate with their family members what they would like in this area. It will avoid any conflict at time when stress is already very high

The best approach is always to over communicate so that there is no doubt left in anyone’s mind. Work with your lawyer to decide what you would like and then give copies to your living will executor and other family members as you see fit.

Preparing a living will for Managing Your Assets

Most people have bank accounts, homes that they live in and bills that they have to pay. Most lenders and utilities, even tax collectors will give you some amount of time to resolve issues. But eventually they all want to get paid. An executor for assets for a living will make sure that all of these bills are paid, taxes filed. They look after all of the usual things we need to manage our normal financial life.

If you are paying someone’s bill most firms and cities will gladly accept your check if it is signed by you and the money is drawn from your account. They will not accept a check signed by someone other than the owner of the account. Unless you can show you have the authority to do so. A living will is just the instrument that allows this to occur.

Your lawyer will draw up a living will and will stamp it properly and witness it so that it becomes a legal document. When the conditions are such that your executor must step in, your lawyer will provide a copy to the executor. The excutor can then use this document in dealing with the banks and other agencies. The banks will want to take a copy of the will for their records before they will give you signing authority to the account of the person you are executor for.

Once you have been given authority, you have the same power over these accounts as if they were your own. The executor has a great deal of responsibility. He or she is managing someone else’s life and must do so in a professional and honest manner. Failing to do so can lead to jail time if there is actual fraud involved.

Duties of a Living Will Executor

The executor must ensure that all bills are paid, file tax reports  as needed and to ensure that the assets of the individual they are looking after are sufficient to provide the proper care for the person that they desire.

This can be a difficult job, especially if there is insufficient funds to handle all of the bills. Use the clients lawyer as a resource and also relatives to assist in the work and the support as needed.

When do the Duties of the Living Will Executor End?

Often the living will executor and the executor of the will are the same person. However officially the duties of the living will executor end the moment the person passes away. The duties of the will’s executor begin once the will has been read by the lawyer at a meeting convened by the lawyer for the deceased.

Sometimes family members will help to make this happen. However nothing can be done until the will is read in front of the family and the executor assumes his duties. This is an important step that must be executed rapidly. Since the executor will be asked to make funeral arrangements. The family needs to know if sufficient funds exist to pay all of the fees associated with the funeral.

Finally if you have any questions in this area, consult your lawyer. They understand the local laws and will be able to guide you along. Of course there is always a charge for these services. But sometimes it is just better to do it right the first time and avoid potential costly mistakes and family conflict.

Many people do not have time to prepare a will and it can cause a great many problems. Sometimes even discourse and hardship for those left behind if there is not a proper will prepared.  For starters, you have not said how you want your estate divided among your heirs. Sometimes one person may feel that they are somehow more entitled than another.

Or perhaps you had a conversation with one person about what they would receive upon your demise, but no one else. Once you are gone there is no one around to back up the claim . They look like they are money grabbers or worse. Preparing a Will is relatively easy and solves so many problems.

The steps to prepare a will for most people is a pretty straight forward affair. However we still seem to resist the notion of writing a will. Perhaps it is because we are admitting to ourselves that maybe we are not immortal after all. That maybe we will only live for a set number of years.

Of course we are young and will be around for a long time, so why do we need a will? Wills are only for old people or people with lots of money. So you put it off and before you know it, it is too late. We are too old and cannot think straight or we are in the grave.

Prepare a Will – It is about keeping your life Organized.

Why not make life simple ? If you prepare a will does it not mean you will die tomorrow. It does not mean that you have to give up any rights. Preparing a will just means that you have organized your life and are going to make sure that your loves are looked after and that those items you treasure most are given to the right person.

It does not mean that you need to give them these things now, just that will receive them sometime. Of course there is another school of thought that suggest that you should bequeath items of sentimental value while you are alive and well enough to enjoy the pleasure you give to people.

So what do you need to know to make a will? The lawyer will handle all of the legal stuff and make sure that your will be handled in a professional manner. In addition they will make sure that your will is properly witnessed and sealed so that when it comes time to read it and make decisions, the court will fully accept the will.

This is an important step. We have all heard of wills being challenged, usually when there is a lot of money involved. This is your lawyers job, to make sure that it is iron clad and cannot be challenged.

What are the Main Steps?

The main step for most people is the toughest. That is deciding who will  actually receive your assets, how much, and how it will be distributed. In our family we believe that everyone should receive an equal amount regardless of need.

We want our kids to remember us as being fair. But that is just us. Not everyone feels that way and it is up to you to state this clearly in your will. You also need to decide will be the executor.

The executor has an important role in executing your will. Depending on the complexity and the size of the estate this can be a time consuming job or fairly straight forward. Regardless of how much work, it is important that you select someone who you can count on do follow your instructions. They should make good decisions in situations were your instructions are not totally clear.

Once you have decided on your executor or executor’s because some people feel that having two will make the work easier and protect your heirs better, it is time to decide on who gets what. This is the really tough part.

Family Heirlooms

There are some specific things that may be considered family heirlooms that need to be clearly stated regarding who is to receive them. It gets difficult if these are personal items and have a lot of sentimental value. Better for you to decide who they will go to than to have your sons and daughters fight over them after you have passed away. All you need to do is prepare a will.

Once you get through the specific stuff, the rest is relatively easy. Most people will advise their executor to sell the assets. They they will divide up the proceeds according to your instructions. Depending on the size of the estate and the time it takes the executor may charge a fee for this service. Most people just want to recover their costs.

What Happens if You do not have a Will

Well the answer to that question will depend on what country, state or province you live in. Many have a variety of laws to handle these situations. However you can rest assured that someone who is not a family member will get to make the decisions regarding who will receive your assets. They will also charge a fee for this service.

Your local government may also charge a fee for overseeing the entire thing. No one will receive what they wanted. They will tend to receive less, your most personal things will be given out by someone else and most of all, no one will be happy.

If you have concerns in this area, your lawyer can fill you in on the details for were you live and tell you what you can expect to happen.

There is another subject which we will deal with in another post and that is a living will. This is a will which tells your caregivers how you want to be treated when you are too sick to make your own decisions.

In summary, prepare a will, and decide who will be your executor ( ‘s). Who will receive your family heirlooms and how the rest of your assets will be distributed after all bills are paid.