An estate account is a bank account that is set up and opened specifically for the purposes of administering a person’s estate after they have passed away. The person named the estate executor will usually be in charge of setting up the estate account and managing it. The estate account should be set up shortly after the estate holder’s death.
An estate account will usually be the place where the decedent’s checking and saving accounts will be transferred upon their death. These will be used to help with the costs of funeral expenses, estate distributions, and other estate administration matters.
An estate account is generally necessary because a person’s bank accounts will be frozen upon their death. This means that the executor (or anyone else) won’t be able to use those accounts, for instance to write a check on behalf of the decedent’s estate. What they will be able to do, however, is withdraw the person’s remaining bank accounts and place them into the estate account. From there, they will be able to conduct transactions on behalf of the estate using the estate account.
Also, after the person’s death, the estate executor or administrator may be dealing with additional money being donated to the person after their death. This can also be placed into the estate account, as well as any other monetary amounts (such as those resulting from sales of the person’s property).
To open this type of account in Nigerian banks requires a lot of legal documents as a result of the sensitive nature of the circumstances always surrounding the ownership and control of a diseased wealth. The bank in this situation deals directly with a competent law court or if the estate executor wishes, he or she can seek for the services of a lawyer or legal practitioner to oversee the process.
Either way the process follows same procedure, since the bank deals with a court in the process of creating and operating an estate account, the first point of call for the estate executor should be a competent law court. There in the court it will be legally established who will be in charge of the estate account, if there is a will in place, it makes the process even easier.
After the legal beneficiary has been ascertained by the court, a letter will be addressed to the bank from the court instructing them to open an estate account for the beneficiary, and this is where the process starts from the bank.
The bank on their part will reply the letter seeking to confirm if the letter actually emanated from the court. When the court finally confirms through a second letter, the bank will now go ahead to open the estate account.
The bank will demand for the following documents in order to open the account:
- Death certificate
- A letter of probate from the court
- Letter of administration
- Grant of probate (in the existence of a valid will)
- A copy of the diseased will (if any)
- All account details of the diseased
After providing all the requirements as it applies, the bank will require the estate executor to provide the following personal documents to open the account:
- A valid primary ID card
- Means of address verification (utility bill, etc.)
- Two passport photograph
- Reference letter
- A duly filled account opening and mandate form
After satisfactorily providing the above requirements, the bank will go ahead to open the account within 24hours and issue a draft or simply transfer the fund in the diseased account to the newly created estate account, the diseased account will be closed after the transfer. The estate executor will now have access to the fund and can chose to continue with the account or close it after withdrawing the funds.
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