How to Get Approved for a Probate Bond

A probate bond, also known as a fiduciary or estate bond, is a legal safeguard that ensures the administrator of an estate upholds their fiduciary duties and manages the estate responsibly. Before a court grants authority to a fiduciary, many require the administrator or executor to obtain a probate bond, which protects any beneficiaries or creditors from financial losses due to mishandling of estate assets.

Getting approved for a probate bond requires meeting specific underwriting criteria, which can vary based on the size of the bond. Here are the key factors that sureties like Jet consider when reviewing an application for a probate bond.

Credit Score and Personal Financial History

One of the most important factors in getting approved for a probate bond is the applicant’s credit score and overall financial health. Sureties want to ensure that the administrator or executor is financially responsible and capable of managing large sums of money. A high credit score indicates that the applicant will be able to safeguard the funds properly, ensure that all debts are paid, and distribute net assets properly. Conversely, a low credit score could indicate that the applicant has a history of mismanaging funds, which can signal potential risk and raise red flags to the surety. 

For larger bonds, some sureties may request the applicant complete a personal financial statement, which breaks down the applicant’s assets and liabilities. This is often required so the surety can understand the applicant’s current financial picture and assess whether the applicant is capable of managing the estate’s finances without personal financial strain. For all bond sizes, sureties will also look to confirm that the applicant has no previous bankruptcies or active liens and judgments.

At Jet, we take a holistic approach to probate underwriting and look at the entire estate, not just a credit score. We do not require credit checks on probate bonds up to $25,000 or up to $50,000 if you have an attorney. You can learn more about the impact of personal credit on a probate bond approval in one of our previous articles here.

Attorney Involvement

The involvement of an attorney is a crucial part of the approval process. An attorney specializing in probate or estate law can help ensure that all legal requirements are followed correctly and that the fiduciary understands all responsibilities imposed by the court. An administrator or executor has numerous responsibilities during probate, which include paying off any estate debts, distributing assets to the heirs, and filing all required accounting with the court. Failure to fulfill these requirements could result in a bond claim, making it essential to have a strong understanding of the probate process or ongoing legal assistance.

When an experienced attorney is guiding the probate process, sureties are more likely to feel confident in the applicant’s ability to properly manage the estate, thus increasing the chances of getting approved for the bond. Jet Surety also provides discounted rates for applicants working with an attorney. In some cases, hiring an attorney is not always possible. Thankfully, we have partnered with services like Trust & Will and MeetAlix, companies that provide modern legal assistance to families navigating the probate process.

Bond Amount

The bond amount, which is usually based on the total value of the estate’s assets, is another factor sureties consider during the underwriting process. The larger the estate, the higher the bond amount required, and the more stringent the underwriting process may be. The bond amount should not include any non-probate assets as they should pass outside of the estate.

Applicants should ensure they are financially prepared for higher bond amounts, as sureties will want assurance that the administrator or executor can handle managing large estates responsibly. For larger bonds, many surety companies will mandate that an attorney be retained or that estate funds be placed in restricted accounts.

Estate Factors

Several factors related to the estate itself can influence whether an applicant gets approved for a probate bond. These include, but are not limited to:

• Beneficiary Disputes: If there are disputes among the estate’s beneficiaries, sureties may view this as a risk since disagreements can complicate the administration process and lead to future bond claims if disagreements are not solved according to law. Sureties may hesitate to approve the bond if they feel these disputes will lead to potential mismanagement or legal battles.

• Ongoing Businesses: If there is an active business involved in the estate, this adds complexity to the management process, as the executor will need to handle not only personal assets but also ensure that no financial harm is brought to those involved in the business during the transfer of ownership. Sureties may require additional information and look for assurance on the plan for the business before approving a bond in these cases.

• Applicant’s Debt to the Estate: If the applicant owes money to the estate, this creates a conflict of interest and increases the risk that the estate might not be managed impartially. Sureties take this into account during the underwriting process and may deny bond approval if they see the potential for financial mismanagement.

Criminal History

If the applicant has committed any felonies or has a history of criminal activity, this can significantly hinder the chances of getting approved for a probate bond. Surety companies are hesitant to approve bonds for individuals with a criminal record, especially if the offense relates to financial mismanagement or fraud. Applicants with a clean criminal history are much more likely to be approved. In many states, anyone who has a felony conviction will be disqualified from becoming a fiduciary.

Get Approved with Jet Surety

Going through the probate process? Don’t fret. We are experts in probate bonds and have expedited the bonding process to make obtaining probate bonds easy and efficient. Click below to get your bond today. Have any questions? Give us a call at (855) 470-0877 to speak to one of our probate bond experts.

The information provided on this blog is for general informational purposes only. It is not intended to be legal advice and should not be construed as such. Consult with a qualified legal professional if you are seeking assistance with a probate or estate matter.