Frequently Asked Questions
Estate Planning
Included below is a brief list of the actions which your personal representative and Trustee should take immediately upon your death. (Many of these actions may similarly be required in the event of your incapacity). This is not intended as an exhaustive and/or detailed explanation of all actions which should be taken; rather, it is for use as a checklist to help your appointed representatives’ step in and handle, as expeditiously as possible, those items which demand immediate attention.
- Consider advising any surviving family member who is alone to telephone a friend who can share the next few hours. Shock and trauma due to the death of a relative can take unexpected forms.
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Contact by phone and notify the immediate family, close friends, business colleagues and employer.
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Notify a funeral director and clergy, and make an appointment to discuss funeral arrangements. Request several copies of decedent’s death certificate which you’ll need for his or her employer, life insurance companies, and/or decedent’s attorney for legal procedures.
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Arrange for care for members of the immediate family, including appropriate child care, having people at the decedent’s house, etc.
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Locate the decedent’s important papers. Gather as many of the decedent’s papers as possible, and continue to do so for the next few weeks.
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Notify the attorney who will be handling the decedent’s affairs. Make an appointment immediately because a tax return may be due within nine (9) months of death. This meeting is important to review decedent’s estate planning documents and to discuss state and federal death taxes that may be payable. The attorney will also determine the extent to which it is necessary or advisable to open a probate estate. (In the event of incapacity, the attorney may suggest additional steps which should be taken for estate planning purposes, particularly if death is imminent.)
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Notify the decedent’s financial counselor. Decisions may need to be made regarding repositioning financial assets and tax planning. The financial counselor may also be able to assist you with several of the items below.
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Telephone decedent’s employee benefits office with the following information: name, Social Security number, date of death (or incapacity); whether the death (or incapacity) was due to accident or illness; and your name and address. The company can begin to process benefits immediately.
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If decedent was eligible for Medicare, notify the local program office and provide the same information as in number 8.
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Notify life, accident or disability insurers of decedent’s death or disability. Give the same information as in number 8, and ask what further information is needed to begin processing your claim. Ask which payment option decedent had elected, and select another option if you would so prefer. If there is no payment option, you will be paid in a lump sum.
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Notify the decedent’s Social Security office of the death. Claims may be expedited if a surviving family member goes in person to the nearest office to investigate making a claim for survivor’s benefits. Look for the address under U.S. Government in the phone book.
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If you need emergency cash before insurance claims are paid, a cash advance may be available from life insurance benefits to which you are entitled.
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If decedent was ever in the military service, notify the Veterans Administration. Surviving relatives may be eligible for death or disability benefits.
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Record in a small ledger all money you or the immediate family spends. These figures may be needed for tax returns.
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Remember that a surviving family member may be in a highly emotional state. Therefore, they should avoid entering contracts for anything, and avoid spending or lending large sums of money.
Matrimonial
REAL ESTATE
Applying for a mortgage means taking a large financial step. You will hear many strange terms throughout the process. Becoming familiar with these terms through use of this “dictionary” will help you feel more in touch.
means loan payment by equal periodic payments calculated to pay off the debt at the end of a fixed period, including accrued interest on the outstanding balance.
Annual Percentage Rate (APR)
is the cost of credit expressed as an annual rate. It must be calculated by using a formula set by federal law and disclosed to the Borrower to aid in comparing different credit plans. All finance charges imposed by a Lender are included in this calculation and an APR is always higher than the simple interest rate when such finance charges like points, origination fees or mortgage insurance are charged by a Lender.
Appraisal
an estimate of the value of property; made by a qualified professional called an “appraiser”.
Balloon
A mortgage in which the principal and interest that are paid regularly will not result in the complete payment. The final payment of a balloon note.
Closing Costs
usually include and origination fee, discount points, appraisal fee, title search and insurance, survey, taxes, deed recording fee, credit report charge and other costs assessed at settlement. The costs of closing are usually about 2% to 4% of the mortgage amount.
Commitment
an agreement, often in writing, between a Lender and a Borrower to loan money at a future date subject to completion of paperwork or compliance with stated conditions.
Construction Loan
a short-term interim loan for financing the cost of construction. The Lender advances funds to the builder at periodic intervals as the work progresses.
Conventional Loan
a mortgage not insured by FHA or guaranteed by the VA or Farmers Home Administration (FmHA).
Credit Report
a report documenting the credit history and current status of a Borrower’s credit standing.
Debt-to-Income-Ratio
the ratio, expressed as a percentage, which results when a Borrower’s monthly payment obligation on long term debts is divided by his/her gross monthly income.
Down Payment
money paid to make up the difference between the purchase price and the mortgage amount. Down payments are usually 25% of the sale price on conventional loans.
Equity
the difference between the fair market value and current indebtedness; also referred to as the Owner’s interest.
Escrow
refers to a neutral third party who carries out the instruction of both you and the Seller to handle all the paperwork of settlement or “closing”. Escrow may also refer to an account held by the Investor into which you would pay money for tax or insurance payments.
Good Faith Estimate
a listing of each service for which the customer will be charged in connection with the real estate loan, and the estimated cost of each.
Gross Monthly Income
the total amount the Borrower earns per month, before any expenses are deducted.
Insurance
a contract under which, for a consideration, one party agrees to indemnify another for a possible loss under specific conditions.
Interest Rate
the percentage rate charged for use of money.
Late Charge
an additional charge that a borrower is required to pay as a penalty for failing to pay an installment when it is due.
Loan-To Value Ratio
the relationship between the amount of the mortgage loan and the appraised value of the property expressed as a percentage.
Market Value
the highest price that you would pay and lowest price the Seller would accept on a property. Market value may be different form the price a property could actually be sold for at a given time.
Mortgage
to hypothecate as security, real property for the payment of a debt.
Mortgage Note
the obligation to pay the debt.
Prepayment
a privilege in a mortgage permitting the Borrower to make payments in advance of their due date.
Title
a document that gives evidence of an individual’s ownership of property.
Title Insurance
a policy usually issued by a title insurance company, which insures you against errors in the title search. The cost of the policy is usually a fraction of the value of the property and is often borne by the Purchaser and/or Seller.
Title Search
an examination of municipal or county records to determine the legal ownership of property usually performed by a title company.