Wills - Right to live in house for lifetime?

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.

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.

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.

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.

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.

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.

Just as an aside - I found doing my mum’s Finance POA quite easy to do, didn’t involve a solicitor at all. We haven’t done a health one, my mum said “You’ll know what to do when the time comes”.
I’m an only child, comfortably off, so at my suggestion mum has bypassed me and left everything to my 3 sons.

This happened to my friend, whose late husband left the house to his adult children from his previous marriage. They were so horrible to her after his death, that she legally sold the house and immediately gave his children a sum of money which was slightly less than they would have received if they had waited until her passing. She was only in her fifties at the time. She then managed to buy a little house for herself with the rest of the proceeds of the house sale.

Oh gosh none of the options are sounding all that appealing now. I think I'll just bump off my husband now to save the complications :D (Note to moderators: this is a joke!)

We had made the tenants in common arrangement when inheritance tax was at a lower level, ie £325,000 for individuals, leaving our halves to three children on whichever was the first death. When Gordon Brown changed the rules to allow husbands and wives to inherit free of tax until the second death, we changed it to leave the house to each other. I was so glad we had done this when my husband died, as I would not like to have to ask my children every time I wanted to do something in the house (maintenance, changes etc.). It's mine and I can do as I like. (Cost of lot of solicitors' fees though!)

A grandmother of mine left her house to my (only child) father, but with the proviso that her 2nd husband could live in it for as long as he wanted to.

I’m sure there was no trust or anything - it was just stipulated in the will. I never heard that it was a problem. They were both well into their 80s anyway, and he survived her for only 2 or 3 years.

A friend suffered due to this kind of agreement. The house was left to the son with the agreement she could remain in the house for the rest of her life. One of the daughters bought the house and although she allowed her mum to remain, constricted her to only a part of the property (Made a sort of granny flat for her)and converted the rest into flats. I am sure that is not what her husband intended. My friends health both mentally & physically suffered badly and unfortunately we lost her within a matter of months

My partner and I had been happily together for 16 years. 12 years in one house and then 4 in the latest. He owned the house outright but left me, in his will, the right to occupation for as long as I wished. He died last year of Coronavirus. His children - with whom I had always had a really good and loving relationship and who are by no means in any financial need - challenged his will and eventually found a legal technicality which invalidated my right of occupation. I have now been evicted and have the prospect of spending the rest of my life in a 1 bedroom rented flat.
Moral of the story? Make sure that any rights you have are safeguarded in a totally watertight legal document. And be careful who you trust

Nona4ever that’s so rotten to disregard their fathers wishes for you.
What technicality could they find in a clearly stated will ?

This is not what the OP has asked but my friend who is a widow with 2 grown up children has a partner who’s lived with her for the past 8 years. He owned his own property but did not have a large amount of equity in it when it was sold.
My friends house us beautiful and they share the household bills. She has taken out a life assurance on herself mso if she dies before him he will have a decent lump sum to either rent somewhere or buy a small property. Obviously my friend wants her home to go to her children as it was the home she and her husband owned.

I have four step children and two of my own. We have tenants in common and have left in our wills in trust half the property to the relevant children of each of us with it written in that the surviving spouse can remain in the property, can sell it and move as well if they want to. The advantage with half being left in trust is that it would be more difficult for the Council or a n other to get their hands on the property because they could only have half and it would be quite complex to sort out…. Definitely a solicitors advice is needed.

I am a trustee in this type of arrangement. My late father intended to provide a life interest for his partner but although he had written a will it was not legally executed (I agree with everyone who says to get a solicitor to draw up your will!). I have tried to honour his wishes as far as possible, with the aid of an excellent solicitor. Legal ownership transferred following my father’s death, which meant that IHT was payable - fortunately there were sufficient funds to cover, otherwise this would have been a problem. The house is held in trust for GC. His partner is protected by way of a formal letter confirming her life interest. She is responsible for day to day maintenance of the property but the trustees are responsible for major works, eg roof, replacement of central heating. We have also stated that we will consider any reasonable request to move, providing the cost of doing so does not exceed the net sale value of the current property. We had envisaged that she might want either to move to a smaller or single storey property or closer to her own children as she gets older. As she does not own the property she cannot sell it, rent it out nor can a charge be placed on it for her care fees. The main danger is that the house will need expensive repairs which we the trustees will need to fund. We could have held funds aside for this at the outset but one of the trustees needed their full share at the time. In short, I don’t think I would look at this type of arrangement to try to reduce taxes, rules keep changing and specialist advice would definitely be required, but I think it can work where the house was wholly owned by one partner who wishes to pass assets to his or her own children only, while continuing to ensure that the surviving partner is taken care of. My tips: 1) use a solicitor who specialises in wills, probate etc, 2) ensure that the surviving partner will have sufficient means to continue to live in the property (heating, council tax etc) by way of pension, cash or other assets, 3) communicate your intentions to ‘interested parties’ to help manage expectations. Children often do expect to inherit and managing expectations about looking after a ‘new’ partner first, ie their inheritance will potentially happen much later, gives people to adjust long before the death, when emotions are running high anyway.

I can't see that anyone has mentioned another pitfall:
The surviving spouse finds the property too difficult to maintain or badly situated for their needs. If the deceased intended for them to have a home, that must be written in to allow a move. Otherwise, if they want to move to a more suitable property, they have to sell, and that triggers handing over proceeds to the other heirs.
Bottom line is that you have to do this carefully.

We’ve looked into equity release but the interest rate is astronomical unless you can pay it back almost immediately. In fact there might be no value left in the house to leave to inheritors. Research it carefully if you want to do that.

I know you started this thread hoping to get some ideas of people’s experiences OP, but by now you must be terrified and your head must be spinning. I’m a retired solicitor. My simple advice to you is to make a list of your questions and then to consult a good probate and trusts solicitor. Not just someone local who does that kind of thing and perhaps other things too. A proper specialist. You may need to travel to see the right person and his/her charges may seem high but I assure you that you get what you pay for with legal advice as with everything else.

Soroptimum

Just as an aside - I found doing my mum’s Finance POA quite easy to do, didn’t involve a solicitor at all. We haven’t done a health one, my mum said “You’ll know what to do when the time comes”.
I’m an only child, comfortably off, so at my suggestion mum has bypassed me and left everything to my 3 sons.

I did mums POA without a solicitor but I would urge you to take out one for health. You may know what to do when the time comes, but if you have nothing in writing you’re at the mercy of what the medics and social services want to do. If you have a health and welfare POA you can get your mum to stipulate what she does and doesn’t want and be sure you’re doing the best for her according to her wishes. There’s something called the ‘Liverpool pathway’ where we live, and it means that a DNR can be applied without relatives knowledge. My mum doesn’t want this, nor does she want to go into full time care except as a last resort. A POA for health and welfare prohibits measures like this from being applied without the permission of the attorney.

Germanshepherdsmum

I know you started this thread hoping to get some ideas of people’s experiences OP, but by now you must be terrified and your head must be spinning. I’m a retired solicitor. My simple advice to you is to make a list of your questions and then to consult a good probate and trusts solicitor. Not just someone local who does that kind of thing and perhaps other things too. A proper specialist. You may need to travel to see the right person and his/her charges may seem high but I assure you that you get what you pay for with legal advice as with everything else.

This. All day long.

We have done this left 100% to each other. Im curious why you say it cost a lot in sol fees, how come as should be straightforward with little or no sol involvement.

I've had my vaccines &booster....

You must cover all eventualities and make it perfectly clear. Many years ago my Aunt (Mother's sister) made a will she left a quarter of her estate to my mother. No proviso if my mother died first which she did such as my mother's next of kin. The money did not come to me it was shared between her nephews and nieces. My Aunt would have turned in her grave as she had already disowned three of them!

Several years ago I legally transferred my house into my son and daughter-in-law's name. It was done legally and my solicitor drew up clauses in my interests.This was due to my elder son marrying and disowning his entire family. There is a clause that if he ever returns to his family he will get a certain amount of money. I did this as he has more rights being the first born and I did not want my step granddaughters inheriting my grandchildren's share.