Though rare, we’ve seen a few self-prepared Wills in the last year that had critical problems aside from the occasional execution defects. Here’s a very simple but critical mistake that you should be careful to look out for if you choose to draft your own.
“The personal representative shall sell my homestead residence and divide the proceeds amongst my children.”
It seems innocuous enough but this sentence can have serious repercussions in how your estate is administered in probate court.
(Reminder: Having a Last Will and Testament does NOT avoid probate.)
Any directive, mandate or instruction that the personal representative shall sell your homestead residence removes homestead protections and exposes the home to claims of unsecured creditors!
Example:
- Mom’s Last Will instructs the personal representative (PR) to sell her home and split the proceeds amongst her children.
- Mom dies with a $200,000 homestead residence which has no mortgage.
- She also has $25,000 in credit card debt from Discover.
- Upon probate administration, the PR must sell the home and Discover’s claim against the estate must be satisfied from the proceeds of the sale.
REMOVE THE SALES DIRECTIVE/MANDATE
In the above example, if Mom’s Will simply said “I leave my homestead to my children” or even more plainly, “I leave all the rest, residue and remainder of my estate (whatever I own) to my children”, the homestead would pass on to her children and they could later turn around and sell the property and retain all profits. Discover could not seek payment from the sale of the homestead.
CHECK YOUR WILL!
Already have a Will? Take a peek at it. We’ve also seen attorney-prepared Wills with this language so it’s not just a problem for self-prepared Wills.