What happens in the real world when a partner is given a right to stay in a property after a death?

[Beamsss]

This is often cited as a way to make sure DC get their inheritance whole partner does not lose their home, or is given time to find somewhere else to live, but I can't really see ir working on a practical level without causing a headache for all concerned.

What happems if the partner becomes to old/unwell to care for the place properly?

Doesn't it build resentment if e.g. children have to wait decades for their inheritance?

What happens if the partner has a new partner and children, and the place becomes their home?

I'm sure there are cold hard legal answers to all of that, but in the real world where people's lives are involved, aren't you just leaving a long term massive headache for everyone you love?

He's a fool then once my now husband and I mingled our finances and trusted each other all property went in joint names. Your dad is choosing to throw his money away

In my 'real world' the children (albeit older themselves now - 60s) have a great relationship with their stepmother and are happy to wait until she's ready to move out. In fact, she is now ready (the house is big and hard to heat) and they are really sad to see the house go so they certainly haven't been pushing her out. It's been ten years I think since the husband and father died.

DH's family have a couple of second family situations but they all range from civilised to very amicable. I don't know what happens if people hate each other.

We also, in the family have a house that a great aunt lives in that was her childhood home. She has two siblings and they each own a third but the aunt who stayed at home and looked after her mother till her death has a lifetime interest. It is what it is. Some of the family do help out with the garden and ensure she keeps it well as they are joint owners. If it needed a big repair job I imagine the three owners would split the cost - it's like the owner occupier is a tenant and they're joint landlords.

No, the entire house is treated for inheritance tax purposes as though the surviving spouse owns it (even though they only own 50%). There is no inheritance tax to pay on anything that passes to a surviving spouse.

However, if the person living in the house is not the spouse of the person who has died then, yes, there will be inheritance tax to pay.

So, if you're planning on doing this, make sure you get married before you die.

Yes thats what I thought- this elderly couple is not married and despite good intentions being expressed about letting the other stay in the house, I think if the homeowner dies first, the other will have to move out as it will have to be sold to pay the IHT, as I doubt the inheriting children have the liquid assets otherwise.

With a standard life interest trust he would be able to sell the house and use all the money raised to buy a house with his new partner. If all the money went into the new house, half of his share of the new house would go into the life interest trust to be held for your children. By avoiding this, you have set up the possibility that he remarries and omits to make a new will, potentially leaving your children with nothing.

The surviving partner can downsize if the house becomes too much for them. Moving in a new partner and children doesn't give them any claim to the deceased partner's share of the property.

You need to think about the alternatives. If they leave their share of the property to the surviving partner, their children may end up with no inheritance at all. And if they leave it directly to the children, they could force the surviving partner out of the house. It doesn't strike me as very loving to leave your partner in that position. So what do you suggest?

Or he meets someone else, gets married and then her children inherit everything.

I've seen this several times, man forgets his previous family.

I think overall I just don't want my DC 'waiting' for an inheritance. I don't want them to have that expectation. I want them to stay in touch with DH, look after him and maintain a relationship. I want that to be their focus, not some 'right' to property.

My FIL did this, he left his share of the house to his sons and his wife (who has cut off all contact with the family) with a life interest. The sons don’t get their inheritance until she dies and as she was younger than FIL she could live for another 20-30 years. She doesn’t live in the house either as she lives elsewhere and as far as we know it’s rented out. She could sell it and buy another property but the trust then moves to the new house and they still don’t inherit until she dies.

I understand why people set their wills up this way, so the remaining spouse is not made homeless and I agree with that, nobody wants to be facing homelessness after losing their spouse. But sometimes it can lead to people waiting years for the inheritance their loved one wanted them to have which just makes it all seem a bit pointless.

A distant relative left my DH a share of a house in this situation - her partner was given the right to live there for life or until he needed residential care. Perhaps it was a bit easier as as a distant relative there wasn’t any expectations around getting the property or emotions that there might be with an old family home. But the partner was an obnoxious man with mental health conditions. The house deteriorated as he aged and his health worsened. He sold any contents of any value (the contents were also only for use not given to him). He was meant to maintain the property but didn’t. It was pretty grim when DH finally got it, and had lost some of its value which meant less CGT to pay at least!

I know of someone who wants a right to remain but wants to keep the home for their children. On their death, the house (no ownership by the person with the RTM) passes into a trust. The terms of the RTM are laid out, what happens if they aren't met - and some of those conditions require that the RTM person maintains the property, pays the rates and insurances, etc. The RTM holds while the terms are met, or all the people in the trust agree to sell or transfer it to a different property, or the RTM person dies. They may not move people in with them. This sort of thing should always be done with good legal advice to protect everyone.

This happened with my Mum. She bought a house with her second husband as tenants in common, and they both had the right to live in the house following the death of the first partner until such time as they decided to move or the second partner died, at which point the proceeds of the house were to be split 50/50 between both sets of children. My stepfather died about two years after they bought the house and my mum lived there for nearly 30 years until she developed dementia and went into a care home. My two stepsisters treated their father badly when he was alive and in ill health, and were very nasty to my Mum and me after he died. She made a lot of improvements to the house and tried to buy out their share a couple of years after my stepfather had died, but the stepsisters were again quite unpleasant to her. My stepfather’s solicitors made contact every January throughout the time that my mum lived in the house alone, and agreed to let me handle the sale of the house when the time csme. My stepsisters finally came out of the woodwork just before the sale was finalised to claim some stone ornaments from the garden which were apparently of great sentimental value and were every bit as unpleasant as I had remembered. My mum and I often talked about how long they had to wait for their inheritance, and how furious they must have been every year thst went by 😆😆

my mum lived there for nearly 30 years
She made a lot of improvements to the house

If you have a house for 30 years you are likely to need to make changes or ‘improvements’ which are really just bringing the house up to standard or maintaining it. It reminds me of someone who managed trusts for disabled people telling me of parents who thought they could just leave their adult child the house without also leaving a very significant sum to maintain that house over the years - a much larger sum than they would anticipate. Windows rot, boilers breakdown, kitchens and bathrooms need replacing etc when people live somewhere for decades.

Yes of course people make improvements to their property over time but that is not what I meant. My mum used her savings to make a number of improvements to the house in the two years after my stepfather died, which at the time increased the value, before she offered to buy my stepsisters’ share of the house. For example, she had central heating installed, which my stepfather would never consider because he thought it was an unnecessary luxury.

But that is what I mean - central heating is a fairly basic expected investment in a property these days that 30 years ago might not have been such a priority. It is a cost to living in a property. If someone is going to be given the right to live somewhere for 30 years or more then it needs to be considered how these sort of expensive inputs will be managed.

In the real world things can turn nasty

A friend's elderly parent bought a property a decade or so ago jointly with equally elderly partner - partner has died and their family are itching to get their hands on the inheritance

Both of them paid equal shares for the house - I bet things often get nastier if surviving partner is second spouse, didn't contribute to buying etc

This isn’t strictly correct. The son will be able to live in the house, but on the death of the remaining spouse the house has to be sold under the terms of the original Will and e son will receive the monetary value of his share. The Will of the first person who died has to be completed by selling the house.

DH mums boyfriend lives in her house. DH and his sister have become unwilling landlords after her passing.

She was unwell a long time and the boyfriend had access to her money in the joint account and refused to spend any money on the house. After her passing, he’s pointed out the windows and roof need fixing which they have had to cover out of their own money. DH jokes that the boyfriend is going to survive longer than him

We had this in DH family. Grandad died in 1997 and gave his second wife the right to live in the house until her death (first wife already dead). Second wife didn’t die until 2024. DH dad and siblings all dead. DH and I dealt with estate. The house was then split between DH and his cousin at 25% each and then the other 50% to Grandads second wife’s children / grandchildren. Second wife never owned the house so even though she did have a new partner for a time (he also died) there was no loss of inheritance as the house was held in a trust until her death. It could have been better maintained but it is what it is.

@HotGrapefruit The reason people leave property to dc is so DH cannot take the whole amount and give it to a new wife. This disinherits dc!

My mother was a widow and married her BIL a few years later but before she did she went to a solicitor and signed her house over to us siblings .
when she died her husband was already 79 and we had no intention of evicting him from the property .
I became his carer until he died eleven years after my mum . We then sold the house . Mum only put the house in our names because she didn’t want his children to have a claim on the property and she also knew that we would look after him .

I know. But what does that matter at the end of the day? If he feels that’s the right thing to do at that point then perhaps it is. They will be adults and responsible for their own relationship with him.

This sounds like the ideal and warmest way this can go. That's quite heartwarming. However, had someone a house has been sign over to be in dire financial straits themselves, in real need of the money, I imagine it could be a different story. They may not feel they can wait the 11 years. This is why RTR exists.

If he feels that’s the right thing to do at that point then perhaps it is

Or perhaps he will remarry and forget that he needs to make a new will. If this happens, he will die intestate and his new wife will inherit everything, leaving your children with nothing.