Wills - Right to live in house for lifetime?

Peasblossom

OH and I have that arrangement. It didn’t need a trust. Just written into our respective wills. We told our beneficiaries when we did it so it won’t come as a surprise.

It was quite simple. The remaining partner is responsible for upkeep and expenses.

We had this arrangement, the purpose being to protect half the house in the event of care home fees being needed. On OH's death I had to set up a trust in the names of our daughters as they technically own half the house. I'm not 'being allowed' to live here, it is my right to live here until I don't for whatever reason. If I move the arrangement will still remain the same, they own 50% of whatever property I own.

Daisy L.
Your solicitor has given you good advice. Don't do it. Inheritance tax is not your direct problem. Any one who transfers property directly to adult children must also be mindful of those transferees own risk of death, divorce and debt, since the happening of those events can force the sale of the property to realise the value of the asset. Only transfer property that you no longer want or need as once it has gone you have no control over it.

My neighbour always lived at home with her mum, never married or moved away.

Her mum left the house proceeds to be divided equally between the children - but my neighbour is allowed to live there as long as she wishes.

It has caused her untold misery - as there's great pressure from impatient siblings to sell the house right now - or very soon. She keeps her mum's several dogs, and won't be able to afford more than a small flat in future. Aren't people cruel?

Franbern.
That is wrong advice. There is a limit on number of appointed trustees to maximum of 4, but you can have any number of beneficiaries of the trust . Often the trustee of the deceased spouse will be their executors.

When my father died my mother remarried and she and her new husband drew up wills where everything was left to their respective children. He was wealthy and had his own property but moved into my mother’s house which she had bought after my father died. My stepfather was given the right to remain in my mother’s house. She died just 6 years later and on her deathbed told me that her husband had said he would not stay there as there were too many memories and that her children would receive their inheritance. After the funeral he instructed my brother and I to remove her clothing and he changed the locks. He remained in the house for the next 8 years till he died
, without spending any money on its maintenance. He and his family enjoyed the use of the house and my family’s heirlooms for all those years. Of course he still had his own house which he and his family used for holidays and which they of course inherited. It was an extremely painful time for my brother and me so be careful.

We aren’t married but own our horse as tenants in common! In our separate wills it us stipulated that the surviving partner will remain in the home! However, if they co-habit or marry then they have to ensure that they pay our surviving children their half ! We hope this will work ??

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

Same as Peasblossom and Muse. Must think about what others have said.

As you are aware you need to see a solicitor for advice on this but the creation of a will trust can be done as part of will making. I have a friend who has done this in full discussion with her ' step' children. She is 8 years younger than her partner. Originally she thought she would have enough of her own savings to ' buy' out the step children to enable them to have their inheritance earlier as she is aware that one could do with the money, but property prices have rocketed and this is no longer an option. As her adult partner know about their dad's will she thinks it should not be a problem unless she needs to sell, as inevitably the question of settling the inheritance early could be raised. The life tenant of the other half interest usually has the power of substitution in case they wish to move and the trust is transferred over to the substitute property. This can come as a surprise to the inheritors but in my friends case, the inherited know this .

The main disadvantage is that the inheritors have to wait for potentially many years for their inheritance as early settlement is usually entirely at life tenants discretion.

A care charge can be put on either owners share in the property. This can make it difficult to sort out a substitute property if the survivor wishes to move to something closer to their relatives or more suited to their needs, it to release part of their equity to live on, as the charge with accruing interest will need to be paid on sale.

DaisyL

I am in that situation made more complicated by stepchildren! I love living in my house which has been my home for forty years but when I die there will be IHT implications for my stepchildren so they want me to give it to them now and pay them rent - but I can't afford to do that! It has to be market rent. Solicitors tell me just to stay put but it is causing some bad blood.

Terrible situation. And wanting rent? Just ignore them.

We were told that a Trust can only be a maximum of four. So, no good for us as we have five adult children.

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?

My parents arranged Tenants In Common with a solicitor some 20 years ago. Fast forward some 19 years and they decided to, with solicitor advice, to put their property into a family trust with my husband and the solicitor as executors. They also did POAs at the same time. My father allowed me to have immediate access with the POA, my mother didn’t. This wasn’t a real problem as they had joint accounts and my father allowed me access. I have to say that I was an only child, so there wasn’t a problem with siblings or extended family. My parents both died the following year, within three months of each other and I was allowed to sell the property, with permission of my husband and solicitor. No probate was required as everything was in the family trust. We did have a minor problem as we underestimated the value of their property and their solicitor needed confirmation of its value before everything could go through.

At the time we made our wills, my DH and I weren't married and living in MY house. The will was made that he could stay in the house if I went first. Then once the house was no longer occupied it was to be sold and all proceeds split between my son and step children.

Why would a trust be needed if all is recorded in a Will. DB died and he left home to children from previous marriage. Wanting to ensure his widow had a home he stipulated in his Will she was to be allowed to remain in the house for life. Also, that if she wanted to move the property could be sold and the funds used to purchase another. Expenses for moving were to be included in cost of new property. His widow did move to an apartment in her home town. Small amount of funds left from sale of first property were given to DB children. Costs for maintenance of property are met by widow. This is quite a common procedure and doesn't need a trust to be set up usually.

I am in that situation made more complicated by stepchildren! I love living in my house which has been my home for forty years but when I die there will be IHT implications for my stepchildren so they want me to give it to them now and pay them rent - but I can't afford to do that! It has to be market rent. Solicitors tell me just to stay put but it is causing some bad blood.

You can only do this if you are tenants in common with your house. If you have joint ownership, this is not an option so you may have to change this.
We have discussed this endlessly and are no nearer to deciding what to do. I want to protect our children's inheritance from losing out if my husband were to remarry but also want my husband to have some autonomy. We have delayed the decision until we have downsized.
His mother was given the right to live in her house until she died but only if she didn't remarry. My husband would never have denied her the right to live in her home no matter what she did so it was pretty moot anyway.
maddyone, I have things the other way round. I have my mother's POA over her health and financial affairs so, as far as she was concerned, that meant I could do everything from that moment onwards. Now she has dementia, I worry about making sure that I am acting within my remit and I am beginning to think it is quite a burden especially when other family members become involved!

PM sent ReadyMeals

ReadyMeals I am. Only just though. Taken 11 months to get the Trust sorted. I can still move if I want to but if the new property costs more I have to find the difference. If it costs less half the profit goes into the trust. No one can touch the Trust until I die. If I go into a residential home they can only use my half of the house for my care plus any residue monies from savings or investments in my name. When one spouse dies its always advisable to check if the remaining spouse's will needs to be changed.

For most people it is truly a good idea, but things go wrong if someone has a parent like mine. I have POA only over her financial affairs, but she refuses to allow it to be activated, even though she is in a care home now, her memory is poor (no dementia) and she rarely gets out of bed. She also flatly refused to allow a POA for health to be set up.

We have made this provision in our wills - the solicitor drew them up and we've just updated them when we moved house earlier this year.

We will need to think about POE in the next year or so - I had this for my parents and was eternally grateful to my husband for suggesting it when they both ended up with dementia and I had to take care of their affairs.

My mother and father did this. After dad died, mother moved to a small sheltered apartment, which was only half the price of the house. She totally refused to pay out the trust to the beneficiaries, instead banking the money for herself. Six years on, she’s still not paid out the trust.

So anyone actually living with this situation after the will's been executed?

I doubt that they would be eligible for Council Care as they part own a property.

readymeals he would still be able to sell, with the agreement of whoever partly owns the house.