While you might think it is easy to leave your house or flat to someone you love, bequeathing property is not always as straightforward as you would think. So, how can you ensure that your home is passed on as you would like?
When someone dies and leaves behind a home, there are a few things that need to be considered. Some things you’ll to think about include:
Is there an outstanding mortgage?
Unless insurance is in place to pay off a mortgage in full when someone dies, the monthly payment will still need to be paid. If the remaining mortgage is small, the beneficiary may be able to take on that debt. But, if there is a large mortgage outstanding, and the beneficiary cannot afford the repayments, the lender is likely to require that the home is sold.
Whether the deceased owned the legal title to the property
When someone owns a property, the legal title – registered with the Land Registry – will clearly show their name as the owner. If the property is not registered correctly, an investigation will have to take place to prove how the title passed to the deceased before it can be given to the intended beneficiary.
How the property was owned
In England and Wales, when a property is co-owned (e.g. by a husband and wife), the way it is registered will impact what happens to it when one owner dies.
There are two ways to own a property with someone else:
- As joint tenants: This means both (or all) owners own 100% of the property. So, when someone dies their name is removed from the title and the home automatically belongs to the surviving co-owner(s).
- As tenants in common: This means each owner owns shares in the property. These shares can be for the same, or different amounts. When someone dies, that person’s share can be left to someone other than the co-owner.
Is the property freehold or leasehold?
If a home is a leasehold, there will be an agreement from the freeholder (sometimes called the landlord) to use it for a set number of years. With a leasehold, there might be conditions on who can own or occupy the property, and this can prove problematic when leaving it in a Will.
If the property is freehold, things are more straightforward. The property and the land it is built on are owned outright and can be passed on however the deceased wished (as long as they are the sole owner).
Is there a Will in place?
If someone dies without leaving a Will, the state decides how your estate is distributed. Often this does not reflect what you wanted to happen. As such, the best way to make sure your house goes to those you want it is to write a Will.
To make sure your home is passed on as you would like after you die, speak to one of our expert team by calling 0800 019 4557 or email firstname.lastname@example.org.