Author: Law Office of Andrew Szocka

Do I need an attorney for my real estate transaction?

When you are planning on buying or selling your home it can be tempting to cut costs anywhere you can. After all, you have broker fees, moving fees, and closing costs. Many people ask themselves if they really need an attorney for their closing. An attorney can actually help you save time and money, and is one of the lower costing items in a real estate transaction. For most people your home is one of your biggest financial investments, it only makes sense you hire a qualified attorney to assists you.

You need a legal advocate

Your real estate broker is not an attorney. They may have a great wealth of knowledge regarding the selling price or purchase of your home compared to surrounding areas, but they cannot give you any legal advice. A real estate transaction contains many legal papers which need to be reviewed by someone with an intricate knowledge of the law. The first aspect of a real estate transaction is negotiating your contract. You need a legal advocate to speak for your rights and give you unbiased advice. A well negotiated contract will save you time and money. It can also save you from negotiating at the closing table or post-closing litigation.

An Attorney can save you time and money

Even if you choose to not be represented by counsel, there is a high chance the other party will. After all for many people your home is most valuable assets. If you attempt to do the real estate closing yourself, you will still need to comply with Illinois law. If you are selling your property, there are many documents you will be required to provide at the closing. If an issue arises, you need to be able to remedy it swiftly. This can cost time and money, especially if you are unfamiliar with the documents needed. The last thing you want to do is breach your contract or delay and jeopardize your closing. Your broker cannot give you legal advice and opposing counsel is not there to help you. By hiring an experienced attorney from the start, you can save yourself the time and costs of attempting to navigate the closing yourself. Additionally, if any last minute closing table negotiations arise, you want a qualified litigator on your side representing your best interests.

Are planning on buying or selling property? Local attorney Andrew Szocka, Esq. provides thorough and speedy estate planning help in the Chicagoland area. To schedule a free initial consultation, visit the Law Office of Andrew Szocka, P.C. online or call the office at (815) 455-8430.

Estate Planning for Medical and Financial Emergencies

If you have medical or financial emergencies in the future, you could greatly benefit from a few key estate planning tools. No one knows when emergencies will strike, but advance preparation can be key. Consider signing advance health care directives, choosing a guardian for children, setting up a trust or savings, and getting life insurance or disability insurance.

Health Care Directives

The last thing you want in a medical emergency is for you or a relative not to be getting the medical care you need. It’s surprisingly easy to be out of the loop with doctors and nurses – especially if you and relatives do not have advance health care directives. You might not be able to talk to doctors on your relative’s behalf. Or the doctors might give you treatment that you do not want. Directives confirm your wishes in writing and tell doctors what they should or should not do in an emergency.

Guardian for Children

In an emergency, your children may need care that you cannot provide. To protect them, consider signing a guardian designation for each child. A guardian designation explains who you want to care for your child if you cannot. While a court ultimately gets to choose the appointed guardian, your designation passes on your wishes and may influence who is appointed.

Trusts and Other Financial Fallbacks

In a financial emergency, you may need some money stashed away to help you stay afloat. Starting a revocable trust or setting up an emergency savings account are two options to consider. You can place money or property into a revocable trust at any time, and you can take it out if you really need it (as long as you are the trustee). Meanwhile, the money or property can earn interest or appreciate in value. An emergency savings account or other savings also could pay your expenses in an emergency. Interest-bearing accounts gain value over time while staying accessible should you need the money.

Life Insurance and Disability Insurance

Finally, signing up for life insurance and/or disability insurance could help you and your family in an emergency. Life insurance pays a lump sum to a chosen beneficiary if the policyholder dies suddenly. It’s a good choice for families, especially those with young children. Disability insurance pays out a lump sum or monthly payments if you cannot work anymore due to a disability. It could be crucial making ends meet.

To discuss various options for preparing for medical or financial emergencies, contact a local estate planning lawyer. You may have even more options besides those listed here, and taking the time to plan could make all the difference.

Want to start planning your estate? Local attorney Andrew Szocka, Esq. provides thorough and speedy estate planning help in the Chicagoland area. To schedule a free initial consultation, visit the Law Office of Andrew Szocka, P.C. online or call the office at (815) 455-8430.

What Are Discretionary and Mandatory Trust Distributions?

If you are a trustee or trust beneficiary, you may want to know more about discretionary and mandatory trust distributions. You might have questions about how often the trustee needs to make distributions and in what amounts. It is important to get answers to these questions so that the trust functions properly, as the settlor intended.

What Are Trust Distributions?

To help the trust beneficiary, the trust’s settlor permits the trustee to make periodic distributions from the trust. The settlor decides on which language to include in the trust document regarding distributions. For example, the settlor could choose to allow distributions on a regular schedule, distributions if certain events happen, or discretionary distributions at the trustee’s option. Read the trust document to determine which kinds of distributions apply for a particular trust.

What Are Mandatory Trust Distributions?

Some trusts require trustees to make mandatory distributions. These distributions might take place every month or every year. Often, a trust requires distribution of a percentage of the interest earned on trust assets during the year. Or the trust might list a specific amount of money or property to be distributed. Sometimes, mandatory distributions must happen after certain triggering events. These could include a significant birthday (turning 18 or 21, for example) or marriage.

Trustees must make mandatory distributions described in the trust document. If they do not, they could face legal liability for breaching their fiduciary duties to the beneficiaries.

What Are Discretionary Trust Distributions?

In contrast, trustees do not have to make discretionary trust distributions. They get to decide when it is appropriate to distribute money from the trust (interest or principal) to the beneficiaries. Maybe the trust assets do not earn much interest in a particular year, so the trustee decides not to make a distribution. Or a beneficiary runs into hard times and the trustee decides that a distribution would help him out. Trustees need to be careful, however, not to favor any one beneficiary over the others. They also need to carefully track distributions over time. Finally, trustees or beneficiaries with questions about distributions should seek legal advice.

Need help with a trust or will? Local attorney Andrew Szocka, Esq. provides thorough and speedy estate planning help in the Chicagoland area. To schedule a free initial consultation, visit the Law Office of Andrew Szocka, P.C. online or call the office at (815) 455-8430.

What Is a Spendthrift Trust in Illinois?

If you have a relative who is bad with money but needs support, you may want to form a spendthrift trust. Many people have someone close to them who cannot manage their own money. A relative may have a gambling problem, have a mental impairment, have a lot of debt, or just need help handling finances. You might be surprised to learn that estate planning could allow you to provide for and protect a family member who is like this.

The Perils of Supporting a Family Member Who Is Bad with Money

You may think that giving money outright to a relative is the best option, even if he or she is bad with money. Or you might want to put money in an ordinary trust for the relative’s benefit. Neither of these methods are usually your best option for a few reasons:

  • Your relative may spend all the money right away
  • Creditors could access the money (even if in a trust) to satisfy debts
  • You may owe gift taxes depending on the size of your gift
  • You lose any control over how the relative spends the money

Instead, consider starting a spendthrift trust to both provide for and protect your relative.

What Is a Spendthrift Trust?

A spendthrift trust is a special type of trust that give the trustee full authority to decide how to spend trust distributions for the beneficiary’s benefit. The trust’s language explains how often the trustee needs to make distributions and may specify the amount to be spent. In addition, the trust language must include a special “spendthrift clause” explaining the settlor’s intent that the trust be a spendthrift one.

Because the beneficiary of a spendthrift trust has no authority to spend or receive trust distributions as he wishes, most creditors cannot access those distributions to satisfy debts. The typical exceptions are debts like child support, alimony, and payment for “necessaries” like food and shelter.

It is very important that your spendthrift trust include the necessary language and have an appropriate trustee. If the trust is not set up right, creditors could go after the distributions and your trust would not have the effect you expected. Talk to a lawyer about how to set up a spendthrift trust to benefit a relative.

Want to create a spendthrift trust or another type of trust? Local attorney Andrew Szocka, Esq. provides thorough and speedy estate planning help in the Chicagoland area. To schedule a free initial consultation, visit the Law Office of Andrew Szocka, P.C. online or call the office at (815) 455-8430.

Estate Planning for Joint Tenants and Tenants in Common

Different methods of owning property, such as being joint tenants or tenants in common, could affect your estate planning. You may not realize how the ownership method changes your options for passing on real estate to your heirs.

What Is a Joint Tenancy?

A joint tenancy is one method of owning real estate in Illinois that gives multiple owners equal shares in the property. The key feature of a joint tenancy is that each owner (called a joint tenant) has a right of survivorship. This means that if there are two owners and one owner dies, the second owner automatically owns the entire property outright. If there are three owners and one dies, the other two owners now hold the property.

Importantly, property owned by joint tenancy does not go through probate. A deceased joint tenant’s estate executor does not distribute the property to heirs because the other joint tenants simply take over ownership via their right of survivorship. The surviving joint tenants simply need to update the property deed.

What Are Tenants in Common?

In contrast to joint tenants, tenants in common own fractional interests in real estate. For example, John might own 25% of a property, Bob owns 25%, and Joe owns 50%. Despite their different interests, each still has the same right to use the property as the others.

In addition, tenants in common have the ability to sell, transfer, or convey their interest (or a portion of their interest) to other people. The other tenants do not have to agree or give permission for a sale. This means that tenants in common can leave their interests in the property to their heirs in a will. They also can place their interest in a trust.

Estate Planning Options Depend on Your Ownership Method

Owning a property by joint tenancy as opposed to tenants in common changes how you can estate plan. Joint tenants cannot give property to their heirs in their will or place the property in trust. Instead, the other joint tenant will receive the entire property by right of survivorship. If, however, you survive the other joint tenants, you will own the property outright and can give it away in your will.

Tenants in common have more opportunities to pass on their ownership interests to others. They can place their percentage interest in a property in trust, give it to an heir in a will, or transfer it directly to another person.

Want to start planning your estate? Local attorney Andrew Szocka, Esq. provides thorough and speedy estate planning help in the Chicagoland area. To schedule a free initial consultation, visit the Law Office of Andrew Szocka, P.C. online or call the office at (815) 455-8430.