Probate can sometimes be a very difficult legal process for loved ones to maneuver through in the state of Pennsylvania. If you have been assigned the executor of an estate, you may have many questions. These may include whether or not you should obtain a bond and how that will work. The answers depend.
The safety net of probate bonds
Probate bonds exist as a kind of insurance for the deceased to ensure that their will is actually enacted after their death. A probate bond usually comes into existence after the probate court assigns an executor to an estate to oversee the process of transferring assets to beneficiaries and other responsibilities regarding managing the estate. The probate bond is then set up by the court as a means to hold that person responsible in case they do not act in the best interest of the estate. These duties can include:
- representing the estate in legal matters including in court
- managing bank accounts for distributing funds or paying debts
- taking inventory of the estate for the court
- maintaining the estate until assets are distributed to beneficiaries
- paying taxes, debts and other bills for the estate
- distributing assets to beneficiaries
Whether or not a probate bond is needed will be determined by the court. This is especially the case if there is disagreement among heirs regarding the estate and who gets what assets. The bond may also be demanded by the will of the deceased.
How probate bonds work
Probate bonds operate through the use of a surety company. This is typically an insurance company that acts as the party that takes responsibility for another party’s performance of a specific action or set of actions as outlined in an agreement. This is why probate bonds are sometimes referred to as surety bonds. The bond is bought with the executor’s own funds.
This bond will not be returned until the court is satisfied. For example, if an heir makes the claim that the executor misused funds in the estate that should have gone to that heir, they can make a claim against that bond through estate litigation. Thus the executor has reason to act in the estate’s best interest.
Overall, probate can be complicated. Part of that complexity can be the need for a probate bond to be bought by the executor. This will help ensure that the executor acts in the best interests of the estate as outlined by the court.