What Is An Estate? – A Couple of Practical Illustrations – Part 2

In the last post, we set out to shed some light on what exactly “Estate” means.

One way to define an estate is to think about property ownership. An estate will be necessary when someone dies owning property in their name only (not in joint tenancy, in trust, etc.).

Illustration – 4 Roles

For our first practical illustration, imagine I owned a piece of real property (land and all the things affixed to or part of land, like: houses, buildings, trees, minerals, etc.). Let’s call it: Cory Acres, since my name is Cory.

Then put yourself in 4 roles.

1) Imagine Cory Acres was a house, and you wanted to buy it.

2) Imagine it was an acreage in a hot oil and gas play, and you were the drilling company that wanted to lease my mineral rights in order to drill.

3) Imagine you were a taxing authority, and you wanted to send me a property tax statement.

4) Imagine you were a bank, and you wanted to loan me money and take Cory Acres as a pledge or security I would pay you back (which is basically a mortgage).

While I am alive, these things are relatively straightforward, assuming we can agree on the underlying terms.

1) I can sign a deed and sell you the property.

2) I can sign an oil and gas lease that will allow you to drill on the property and pay me part of what is produced.

3) You can mail me the tax statement, and I can receive it and pay it.

4) You can loan me the money, and I can sign a mortgage to secure the loan.

The Problem of a Deceased Owner

Problem: What happens when I die?  And you still want to do all the things listed above?  The problem is that after death, I can literally no longer sign the deed, execute the lease, receive a tax statement, or give a mortgage.

The Solution of an Estate

Solution: One major function of an estate is to find the new legal owners (often who are set out in the terms of a Will) and establish them with good title so they can move forward signing deeds, executing leases, receiving and paying tax statements, giving mortgages as security for loans, and doing all the other things property owners do.  Many times someone appointed to represent the decedent called a Personal Representative can do these things during the estate if needed.

If our office may be of assistance to you in these areas, do not hesitate to contact us at (580) 338-6503 or at coryhicks@fieldandhicks.com or using any of our contact information in the profile.  You can also visit www.fieldandhicks.com for more information.

This blog contains general information and the opinions of the author – not legal advice; you should seek the advice of competent counsel (attorney/lawyer) when considering any legal issues.