I would like to know what happens to a bank account if the customer vacates it due to death or other circumstances. Some examples, a wealthy hermit who dies and leaves no will. Or, a transient person who just leaves $2.13 cents in an account and leaves town.
What happens? I am sure the 2.13 scenerio happens quite often. There are stories of people who die in their homes and are not discovered for monthes or years.
SP
Welcome to the SDMB, shep proudfoot.
The laws seem to vary depending on where you live, but an inactive bank account is first subject to bank charges, then is either claimed by the state or federal government after 3 to 7 years (as I say, depending on the laws where you are.)
A bank account is just like any other property: when its owner dies, it passes into his or her estate. If the owner left a will, then no problem: the estate is disposed of as the will directs (subject, in some cases, to a “family allowance” for a surviving spouse and minor children). But if the owner died without leaving a will, or “intestate,” then the property is disposed of according to the state’s laws of intestate succession (the “state” meaning the one where the owner was living when he or she died). If no heir claims the property, and the bank cannot locate an heir, then the Uniform Probate Code (article 2, section 105) provides that “the intestate estate passes to the state.” (No kidding. That really is what it says.)
Not all states have adopted the Uniform Probate Code so your state’s law may vary.
Oh, and where are my manners: welcome to the Straight Dope Message Board, shep proudfoot!
Two clarify: any account with no activity for a set number of years (that varies from state to state) become property of the state. The state takes the money. If you show up to claim it and can prove it’s yours, they will return it, but you’ll get no interest during the time the state held it.
If the owner of the account died and his heirs claimed it (assuming they could prove a valid claim), the state would return the money to the heirs.
If the owner of the account dies and the account is claimed before the time period is up, it becomes part of the estate.
Don’t most banks charge an inactive fee. Seems to me that a banks fee would eat up most of the money if it was a matter of years. (that is on an average account.)
I had an experience where I opened an account with St Paul Bank. (or something like that), because I traveled I never got around to using it. But then they merged with Charter Bank. But my original account was TOTALLY FREE. When they merged they dumped my account into one that had an inactive fee. Since I only had $50.00 in it, the 10.00 a month inactive fee, killed it quickly.
The National Association of Unclaimed Property Owners has links to databases of unclaimed property in each state, indexed by the last known owner’s name. I’ve found a bank account my brother had forgotten about, and a life insurance policy that my deceased grandaunt owned.