Many real estate investors believe that having a plan means building trust. However, there more that should be included in your real estate planning to ensure certain of all your assets transfer seamlessly upon your death. An active real estate plan should offer provisions allowing your family members to access and control your assets once you cannot do it by yourself. The following are real estate planning essentials:
Durable Power of Attorney
It is vital to draft a durable power of attorney so that the person you assign will act on your behalf when you can no longer do it. Lack of power of attorney implies that a court may decide what happens to your assets when you are dead or mentally incompetent. The decision of the court may be against what you wanted. It's advised to hire a local attorney like this probate attorney in San Diego or one in your area. You can reach them out for a durable power of attorney. A durable power of attorney gives your agent the mandate to transact real estate, make legal decisions, and enter into financial transactions.
Wills and Trusts
A trust or a will sounds expensive to real estate investors. However, a trust or a will is one of the significant components of every real estate plan. The will or trust ensures that the property is distributed according to your wishes. Other trusts can be used to limit estate taxes and other legal challenges. Ensure that the wording of the will is precise and straightforward as it is critical. You should ensure that the will is written consistently with the way you have bequeathed the assets.
Beneficiary Designations
A number of your assets can pass to your family members without being dictated in the will. For this reason, you have to maintain a contingent beneficiary. You should also ensure that your insurance plans contain a beneficiary since they can also pass outside of a will. In case you do not state a beneficiary, or the beneficiary dies, a court could be left to decide the fate of your assets.
Healthcare Power of Attorney
The healthcare power of attorney designates that another person to make vital healthcare decisions on your behalf in case of incapacity. In case you are executing such a document, pick someone you trust, and share your views. The person you choose should also recommend a course of action you can agree with. Literally, the person will have your life in his hands. Moreover, you should identify a backup agent if your initial pick is not available.
Letter of Intent
A letter of intent is a document left to your beneficiary or executor. The letter should define what you want to be done with specific asset after your incapacitation. However, such a document may not be valid in the rule of law, and it helps inform a probate judge on your intentions regarding your asset distribution.
Guardianship Designations
In case you are considering to have a guardian, or you have minor kids, this document is vital. Ensure that an individual you pick shares your views is genuinely ready and willing to raise your children and is financially stable. Just like other designations, ensure that you have a contingent guardian named if you do not have such designations, a court rule that your children live with a family member that you would not select.
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