Wills- can I leave my share of a jointly owned asset to DCs?

[MrsMcBoatface]

Or, would DH (the other joint owner) automatically get the lot?

I'm not trying to be maudlin but we're in the process of potentially buying another property and redoing wills as both DCs are over 21 now (we had guardians named on the last ones!) and it got me thinking, if I died and DH got my 'estate', as per current arrangement of half share of jointly owned properties, would he potentially be able to spend the lot, or remarry and all his assets go to a new family, and my DCs potentially not inherit my presumed half of the assets?

I've googled around but can't find any dirct advice about this! It seems simple ...and it's not that I have any plans, but these things do happen and I hear about first families being cut out. Even if we keep things as they are I want to know the implications, at the moment I've realised I'm woefully ignorant.

[prh47bridge]

It depends how the property is owned. If you are joint tenants the property will automatically pass to your husband on your death regardless of anything you say in your will. If you are tenants in common your share of the property will form part of your estate and you can do whatever you want with it in your will.

[MrsMcBoatface]

Thank you so much bridge! That's one question on a form we've had from the conveyancers. I had assumed as we're married it would always be joint tenants.

I suppose he could have the same questions or issues as I do. So if my half (halves) passed to both DCs they would all three jointly own the property. I'll look into this further.

[Ireallydontseewhy]

You can sever a joint tenancy on an existing property and become tenants in common - i think both sides have to agree, or you get a court order (maybe that wouldn't be too conducive to good relations! ). Definitely worth thinking about - Most of us think oh dh/dw would never cut my dc out, but a) they might! and b) if they remarry or even just repartner (i know, but it's shorthand) then that new person may have a good dependency claim to inherit even
if dh/dw leaves everything to dc - you can challenge a will in some circs.

[MrsMcBoatface]

Thanks Family I had never looked into this before, or appreciated the implications! I think forewarned is forearmed, I would rather know I was protecting the DCs interests. As it is two properties, I need to look into the ownership status of the other one. I'm sure DH wouldn't end up homeless in any event but worth thinking about a lifetime interest.

[MrsMcBoatface]

Apologies for bold fail Family!

[7to25]

My in laws did this and one has since died.
I think ,in their case, it was so that at least half the estate went to the children and wasn't used for care home fees.

[MrsMcBoatface]

Ireallydontseewhy -exactly. This happened in my fathers family, he repartnered aged 82 or so, new fancy woman got over 50%. my DF and 4 sisters ended up with very little...hence my concern!

[LyndaNotLinda]

My parents have added a clause to their will that says something like if one of them dies, they can draw a living allowance but if the surviving partner remarries, the estate is ringfenced.

They have a couple of friends where the wife has died and the husband has remarried a much younger women and the kids got nothing

[MrsMcBoatface]

BTW, I didn't mean to sound flippant about GFs situation, my DF didn't begrudge him anything, but looking back it was clear that he was taken in by a 'gold digger'. She went to court to claim, as they didn't marry and he had no will, she claimed she'd been caring for him. Our family wasn't previously involved except to wish them well/happiness, naively not realising she'd go for 100% of his assets when he died 2 years later.

Interesting, 7to 25. I'll look into that as well. Seems too simple? There must be tax implications for the DCs.

[MrsMcBoatface]

Thanks Lynda I'm glad to hear I'm justified in being concerned! Seems grabby, but better to know!

[Ireallydontseewhy]

Yes, I think people are becoming more aware of the remarriage/repartner issue - im not sure why, possibly its because more people have more substantial amounts to leave (usually the house) these days. But it's surprising how often someone knows someone to whom this has happened.

There isn't a perfect solution - a life interest does reduce flexibility (yes you can sometimes move to a smaller house, but i think trustees have to agree to that). And you don't want dh/dw to end up impoverished! But equally, you want to protect dc's interests - well, some people do - i know others think dc should make their own way, fend for themselves, cant expect to inherit a lentil etc - but if you are one of nature's 'bequeathers' it can feel very important! World divided into two sorts, as usual....

[MarlowWills1]

I'm a Willwriter (hence the user name!), and I'm increasingly adcpvising couples even in first marriages about life interest trusts.

A LIT rinfences the spouses' respective shares in the main home for (usually), the children. When the first spouse dies, their share is held on trust for the eventual benefit of the children, but whilst the surviving spouse is alive and unmarried, they can continue to live in the house without interference.

If they wish to move they can; I always include a portability clause. When the second spouse dies or remarries, the house is sold and the first person's share goes to the children even if the survivor gave their half to a new girlfriend/charity/whatever.

It is crucial that the property is held as tenants in common but severing a joint tenancy is very quick, easy, cheap, and doesn't need the consent of the joint tenant.
I also do these trusts for older clients who are concerned about minimising nursing home fees.

[MarlowWills1]

By the way, you don't necessarily have to make Life Interest Trusts; if you trust each other to be organised and remember to make new wills if/when the survivor remarries, that'll be enough.

The concern which a lot of people have isn't that they don't trust their partner/spouse not to cut out the children on remarriage, it's that they think the survivor may just be unaware of the dangers.

[Ireallydontseewhy]

Can you have a 'life interest' but for a shorter period - say a fixed term of 5 years, or 'on remarriage' (i have read about the latter but not the former)?

I suppose one problem with a life interest is that if you think dsurvivingspouse may have to sell the house and live off some of the proceeds, you won't want to deprive him or her of the flexibility to do that. So you need to be quite confident that they won't ever need to downsize to live off the capital. Not an easy thing to be confident about!

[user1464519881]

Also as this is a second property I would not go for a life interest trust. Instead I would make sure you left your half (holding as tenants in common) to the children as indeed your husband might choose to do too.

With the family home you probably do want your spouse to inherit the half of it but perhaps just for their life as suggested above.

[MarlowWills1]

Can you have a 'life interest' but for a shorter period - say a fixed term of 5 years, or 'on remarriage' (i have read about the latter but not the former)?
The best option there would be Right to Reside, rather than an LIT. Rights to Reside are often used for cohabitees where there are no children, so not the same level of commitment as a marriage with children.

I suppose one problem with a life interest is that if you think dsurvivingspouse may have to sell the house and live off some of the proceeds, you won't want to deprive him or her of the flexibility to do that. So you need to be quite confident that they won't ever need to downsize to live off the capital. Not an easy thing to be confident about!
No, usually LITs have a portability clause so that if the surviving spouse wishes to move/downsize they can do so. If the 2nd house is cheaper, their share of the excess is of course theirs to spend as they like, and the first to die's share usually passes to the children at that point.

[Ireallydontseewhy]

Oh good point marlow, i'd forgotten that surviving spouse still has his/her share of the property - so some of the capital released is his to live on.

I do think though that one of the best ways to ensure rows between people who previously got on reasonably well may be to leave people shares in property when they have different interests in it. So ok to leave a house to four children who all want to sell, but if you have, say, a parent who wants to live there while the dc could really do with the capital released from downsizing, relations may not always stay as harmonious as people would like to think! Money i think is less contentious - if i had a choice (haha!) i'd rather leave a person money than the equivalent as a share of property. Obviously most people don't have enough money to do that!

[MarlowWills1]

Indeedy!

Much of my time is spent writing wills, particularly those with quite complex trusts for people with complicated family arrangements, with a view to avoiding the possibility of litigation arising out of disputes.

Often this involves opening a can of worms which the client would prefer not to think about, but it's essential to think about every "what if", and to plan for every reasonably foreseeable eventuality

[whataboutbob]

My dear mum died suddenly at 54. She had left her house to me (probably assuming she'd die after my Dad). However, it was held as joint tenant with my Dad, who 21 years on is now in a care home with dementia. When I saw a solicitor a couple of years ago, she told me that as it was TIC not joint tenants the house automatically reverted to my Dad, and it will probably have to go to pay for care home fees. I am sure my mum would not have wanted that, but she didn't realise the implications of TIC.

[whataboutbob]

Having re read my post i think it was the other way round, they were joint tenants. She should have gone for tenants in common. My Dad has another house which he lived in till he went in to a care home.

[MarlowWills1]

Hi Whataboutbob

Yes, that sadly is something which happens quite frequently. Had the house been held as tenants in common, linked to a life interest trust, the local authority would only be able to attach your father's share of the property to fund his fees; your mother's half would have gone to you & any siblings.

[whataboutbob]

Yes, thanks Marlow. I don't want to come across as graby and even before I understood the different tenancies I never would have challenged my Dad, but I just know mum wouldn't have wanted it all to be sucked into care fees. When I do my will I'll make sure to be v careful about tenancies in case one of us needs to go into care.

[MarlowWills1]

Whatabout, yes, it's certainly something I tend to raise with clients over about 60.