Personal Net Worth Statement for Estate Bond Applications
If you’re the executor of an estate, the court may ask you to provide an estate administration bond to protect the beneficiaries. When applying for an estate bond you will be asked for things like a copy of the Will, a bond application and a personal net worth statement.
What is a Personal Net Worth Statement?
Quite simply this statement outlines all of your assets and your liabilities. The total of all your assets less all your liabilities equals your personal net worth.
Personal Net Worth = Total Assets – Total Liabilities.
Assets are basically things you own with value. Investments in the stock market, real estate, other real property and shares in private companies are examples of assets. Liabilities are basically things you owe. A line of credit, credit card and your mortgage are examples of liabilities.
What are the Implications of this Statement?
Bonding is effectively a credit application. The bond guarantees that all of the beneficiaries will receive their portion of the estate so they want to ensure there’s no concern about your ability or willingness to do so. Essentially the higher your personal net worth the more credit worthy you will be perceived. It is important to note that for estate administration bonds, collateral is not required, so don’t leave any assets out for fear they will require them as collateral.
Do I Need an Accountant to Complete the Statement?
An accountant is not required. Simply do your best to list all of your assets and liabilities with current values. At the end of the form you will need to sign it and witness the form attesting that these values are true. In addition, you consent to the bond company has the ability to pull a soft credit check which will not affect your credit score.
Need an Estate Bond? Please give us a call at 1-844-241-5656 or via email at firstname.lastname@example.org.