The term probate implies distribution of assets after a person’s death. Generally, a probate process in the court might involve; finding the person’s will, executing it, paying any of his/her debts, paying for his/her funerals, property distribution, and so on.
About the Probate Bond
When a person has passed away, the court has to divide his/her estate among heirs. To simplify things, the court names a personal representative who will be responsible for liquidation or distribution of the property fairly and honestly.
The court needs a guarantee that this person will effectively carry out his duties. This is where probate bond comes in. Probate bond has to be obtained by the personal representative. It is a guarantee to the deceased person’s heir that they will get their rightful share. Any defaults by the trusted person will mean that the probate bond can be invoked and the heirs will be compensated.
Cost of a Probate Bond
The cost of a probate bond is determined by the probate judge. There are several factors that he/she considers:
- Size of the estate,
- Relationship of the personal representative with the deceased person and beneficiaries,
- Residence of the personal representative.
Typically, probate bond premiums are 0.5 percent of the total bond amount.
Who Pays for It?
Paying for the probate bond premium is considered estate administration’s responsibility. The amount is paid from the estate’s assets.
In case a personal representative has paid for the bond, he/she is reimbursed later on.
Some Types of Probate Bonds
Let’s take a look at some types of probate bonds:
- Administrator bond
- Trustee bond
- Conservatorship bond
- Personal Representative bond, etc.
Is a Probate Bond Always Needed?
The court decides whether a particular estate requires probate bond or not. Here are some times when a probate bond might not be required:
- If the will specifically states that a probate bond is not required,
- If the bond is suspended,
- If the financial institution becomes acting fiduciary.
Other Aspects about Probate Bonds You Might Want to Know
The probate bond will only be issued if the personal representative lives in the United States. The company issuing the bond will need to check the personal representative’s financial information and credit report.
The bond can only be nullified by the court’s order.
With a team of expert underwriters, we at BondPro issue probate bonds across 50 states in the United States. Our court bonds ensure that the will is distributed fairly among heirs.