Wills - Right to live in house for lifetime?

Great question..
I will be buying into My Partner property..We each have children...Like You We will be going to a solicitor when I do.

A friend did this, leaving his property (through a will) in trust, to go to his relatives after the death of his wife. One of the siblings was full of resentment and greed, feeling she should have had more than his partner of 10 years or his daughter.
His wife tried to free up capital, with the intention of giving the future beneficiaries something now, rather than later.
They were not satisfied with this and have announced their intention to contest the arrangement.
It is always hard to know who will react in this way and it needs to be legally (and tightly) arranged. I suspect that our friend's will may not have been very well drawn up. And it was a mistake for his wife to try to be generous, it was seen by the greedy sister as a sign of weakness rather than generosity.

Seajaye you are quite right - even if it is your own child involved there can always be a divorce or death and circumstances will change. I believe it is a legal requirement that if you give a property away but wish to continue to live there you have to pay the market rent. As you say I don't have to do anything but it doesn't make for a very nice atmosphere - particularly as we all live very near each other.

I know we did all this ages ago. The main thing I remember is that there is a big difference between joint owners and owners in common when it comes to property, IHT etc.

We got our wills done free as a charity initiative, though the charity appreciate it if something is left to them in the will, without making it a condition. I worried this might mean a second-class service, but was reassured by speaking to the Law Society. My husband and I have mirror wills, both leave everything to only child, DD,after our day with life interest for the other.

We have struggled with a trust set up after sudden death of DB in his 40s, intestate. Father was living with us. He decided to make a deed of variation to leave DB’s house and effects to our DD as he had enough for his needs. We were unhappy about her having all that aged 18 in her first job, and his solicitor suggested putting it in a Trust for her, with DH and I as trustees, which we did. 10 years down the line, although the original legacy was not large enough for inheritance tax, we were hit with a huge inheritance tax bill from HMRC, who initially said it could be be submitted by us but gave us wrong information, their helpline was useless during first lockdown, 4 hour waits and clueless juniors answering from home. We ended up with a massive bill from expensive trust tax specialist accountants that we ended up having to go to, as ordinary ones said they had no knowledge in the area. Ate up a lot of quite a small trust and caused a lot of distress.
And families! Darling aunt, widowed and childless, died 1 year after my father, her brother. Left her assets to her 7 nieces and nephews, including my DB, who had predeceased her, as had my father, his surviving parent, of whom I was sole beneficiary. DCousins decided aunt’s assets should now be split 6 ways. It felt wrong, but I never did pursue it to find out if DB’s share should have come to me, I was too fond of DA to have her family fighting over her money.

LynneH

I believe that you could try applying to the Court of Protection to activate the POA

This would only apply if the donor had lost capacity. I have POA for my mum who has dementia. Even though the POA is activated I’m obliged to involve mum in any decisions concerning her welfare if she has the capacity to understand and contribute an opinion at the time the decision is being made.

Janetashbolt

Didn't Lord Linley throw princess Margaret out of her place in the Caribbean after she agreed to give it to home in advance of inheritance

I expect she had one or two other grand houses to live in!

Didn't Lord Linley throw princess Margaret out of her place in the Caribbean after she agreed to give it to home in advance of inheritance

On no account should you give them the house now! And pay them rent??? You'd be entirely unprotected. They could chuck you out whenever they wanted. Pure greed.

ReadyMeals

We are tenants-in-common already so that bit works. An alternative I was thinking about is to leave a proportion of the home directly to my children, but instead of forcing sale of the house, have my husband raise the value of what is left to my kids by equity release, which then takes care of preserving his rights to live in the house without any hassle to the family, and they get their money straight off. What do you all think of this idea?

Taking out equity release to pay early inheritance is a really bad idea. The equity companies generally don’t value your home at the full market value and if the surviving partner lives long enough, the remaining equity can be eaten up and exhausted, leaving them to pay rent to the equity company. In addition, if the surviving partner needs to go into full time care, the full value of the house would still be taken into account. Local authorities have the power to investigate any financial transactions and could potentially demand the funds back from the recipients if they decide that the equity release was to avoid care home fees. The funds would then be paid back to the equity release company along with interest accrued and the rest of the home’s value would be used for care fees. I think you would be well advised to take independent financial advice before making a move like this.

DH and I also set this up. Sadly, DH died a year ago. The estate isn’t quite settled yet, but my two AC will now own his half of the house. I’m glad, because his assets are sorely depleted due to care home fees and if the same should happen to me, at least his half of the house won’t be used for my care, only my own share, which I think is fairer.

Lots of pitfalls illustrated here are due to poor legal advice. Engage a solicitor who specialises in this field - you can look them up on sfe.legal
Be clear about what you want to achieve. Solicitors will tell you that even the apparently nicest families fall out over property and wills. Make it absolutely clear what is going to happen.
Powers of Attorney for both Property and Affairs and Health and Welfare make life so much simpler. Register (activate) them immediately - you never know what the future holds eg. a stroke or an accident. Your Attorneys (the people you appoint) MUST act in YOUR best interests, and while you are still mentally competent, YOU have control. If you don't have POAs in place, the Office of the Public Guardian will administer your affairs if you become mentally incompetent, and that costs a huge amount of money!

Same as seaway. We are tenants in common both of us leaving our share of the property to our son. It’s all been done through a solicitor.

I am about to re-marry a man whose wife died 3 years ago and left a will with their house in a Trust for their four children. He sold this and bought a house for him and me to live in but upon his death the house belongs to them and I may have to move. We asked a Solicitor for advice and the best we can do is to put a Letter of Wishes with his Will saying that he wants me to stay in the house for as long as I want to or am able to. Then they can sell it. Being married will give me some security but I am aware of the situation and cannot do any more about it.

I have been thinking of this for some time, I want to a) Ensure that all my hard earned doesn’t go into care home fees but to give my children and grandchildren a financial leg up b) Ensure my husband has enough to see him through to his end c) Ensure no new partner can benefit from my earnings. From what I can make out if there is no formal legal trust and I require residential care once husband has shuffled off, and there is no qualifying dependent living in my home then it is included in my assets and once my savings have gone the house would have to be sold to pay the fees - leaving next to nothing for the family. A friend was allowed to remain in her husband's house following his demise for as long as she wished but her stepchildren put her under such pressure to go it made her ill; it shows how important getting the minutest detail exactly as you want it. As they say - where there’s a will there’s a family and promises made to the dying are often not fulfilled, once money raises it’s head greed works its nasty ways. Definitely not a DIY job!

When I was a girl in Scotland (Scottish law)I was left a sum of money by three old ladies who must have had some private arrangement. I was not to get the money until their brother died and he had what was called a 'liferent' use of the money.

These old ladies were not rich, they were only mill girls.

DaisyL.

Sounds like their being greedy to me. I agree ignore them. Tell them it’s not possible to afford the rent. Suggest what you could afford and ask if they could make up the shortfall that might deter them.

Peasblossom

Do you mean buy them out readymeals as in he would own the whole house?

Yep, I guess that's what it amounts to. I wasn't planning to leave them my entire share of the property anyway, so it wouldn't be a scary amount of money to raise.

Lots of good advice here but as everyone has different circumstances I’d take on board the comments and use them as a starting point with your solicitor. If you are married remember everything goes to the spouse tax free ….

We had a solicitor write our wills. My aunt and uncle had a trust and my cousin had an awful and expensive time sorting it out. She reckoned the only people benefitting from the trust were the solicitor and the bank.

We each have two daughters who will inherit part of the house but the surviving one of us can live in the house and maintain it. I don't think you can cover every possibility but we have made our views clear in an email to all four of them and I'm as sure as I can be that they will all co-operate.

I believe that you could try applying to the Court of Protection to activate the POA

Additionally - there was an executor of the will however once they'd read it they declined to be the executor.

hereshopping If your daughters are selling their main residence and moving to another main residence they don’t have to pay the higher rate, even if they own part of another property.

It’s buying a second property that is not your main residence that is liable to the higher rate.

I know someone in the position of the adult children in this case. The parter of his mum for the past 8yrs [only lived with her for the past 2] is allowed to remain in the house until he dies.

It's been a nightmare from the very beginning - he fought them about the kind of funeral she would have wanted. He has refused the adult DC from entering the property at all so they are unable even to take any of their mothers things they may have wanted to remind themselves of her. He's said her car is his even though their mum paid for it and had it before he was on the scene. He's written letter after letter of complaint accusing them of numerous things they have not done - all this is being dealt with via their solicitor which is costly and likely to mean that there won't be any money at all left by the end.

We considered this but fear that if either of our daughters want to move house in the future then they would have to pay the higher rate of stamp duty.
When we move to this house, a shared property with my mother in law, then we had to pay the higher rate on the whole property even though MIL had already sold her house. We were able to reclaim the extra later when we sold our old propery.