Can’t sell house until stepdad passes

[Gulpalp]

Mum has allowed for stepdad to live in her house when she passes
The actual property has been gifted to the 2 children but they can’t release the value of it until stepdad passes and only then they can sell
Whilst he is alive and living there can they extract value from the house via equity release or otherwise and how does that work?

That isn't the key issue - its the cost of managing and maintaining a property which you cannot sell or rent out commercially. Equity release might be an option to cover those costs.

The trust needs to be written to factor in these considerations and account for them or the kindness to the stepdad can become a significant burden on the children.

No, I meant that the beneficiaries (in this case the children) could seem to be well off because they have the asset of the house, but actually be skint. This would (or might) mean that they were ineligible for means-tested benefits etc.

Ah, yes - I see what you mean.

Another thing that occurs to me - which may not bother some people, anyway - is the fact that equity release is almost based on your advanced age and the fact that your death is significantly nearer than your birth.

If you decide to go for equity release on the home that you own and live in, you're acknowledging the fact that the deal you strike is partly based on how likely you are to die before too long. Maybe by-the-by, but I could see how this could be more upsetting to people like the step-dad in this scenario - when somebody else is effectively making a deal based on your life-expectancy.

How does this work? Ie how doea a person gift a house to dc , but allow for spouse / partner live there ? I asked a solicitor about this recently .. did not appear to say this was possible ? She said the nearest thing was mirror wills so that half the assets of the home and with each person in a cple , but seemed to think you cant put house in dc names?

Another thing that occurs to me - which may not bother some people, anyway - is the fact that equity release is almost based on your advanced age and the fact that your death is significantly nearer than your birth.

Should have said "almost always based on your advanced age" - too late to edit it!

@Gulpalp I honestly don't know why there are so many morally outraged at your post😀 it's called financial planning and rich people do it all the time.

There are ways to try and extract some value from the property. You have what's called a Reversionary Interest. You may be able to sell your RI. It used to be fairly common 20-30+ years ago but has very much fallen out of favour and it will probably be difficult to find a buyer these days.
There is also a market for the sale of property with a life tenant but again probably very limited and doesn't quite cover your scenario. You own an an asset though (albeit subject to the life tenancy which reduces its market value quite considerably) and if you can find a willing buyer there is no reason why you could not sell it.
Mortgage or Equity Release very, very unlikely unless the life tenant is also liable.
I think in any of these scenarios you would be very lucky to be able realise any more than 40% of the value even if you can.

You should consult a STEP qualified solicitor for advice.

Inheriting a property with a life tenancy can be a bit of a poisoned chalice as although you don't legally own the property, you do have an interest in ensuring the life tenant does not damage or diminish the property or encumber or sell it.
A life tenant owns the property while they live there and is usually expected to maintain it as any other owner would do but if they don't do so, it can fall on the remaindermen to cover any costs.

The kids should be able to do what they want with their house but there is stranger living in. How typical.

Have you read the OP?

It's a common enough thing to leave your house in trust for your kids but with a right for your partner, usually a second husband/wife and not a biological parent of your children, to occupy during their lifetime.

I have , my husband has the same set up and we still do not know what the will states and who will pay for needed repairs. It is a very unpleasant situation for the kids

Always going to be a challenging set-up with blended families, especially if people don't get on.
How do you keep tabs on the property if you don't get on with the step parent?
How do you prevent the step parent from giving it to their own child(ren) only, if mirror wills are based on trust?

My ex was screwed over twice.
Once by a biological parent leaving no will and the surviving legitimate child not notifying him (illegitimate) of this (he would still have inherited half if father intestate).
Secondly by a stepfather changing his will to favour his own children only. His Mum would have turned in her grave.
I have long since told my own parents to spend all they have while they're alive. I'm relying on nothing and no one, so I won't end up disappointed by an inheritance that ends up not forthcoming.

Surely it's pretty usual for the surviving half of a couple to live in their family home until they die?

I don't fully understand OP's problem but as she has come back and said she's not going to give any more details ... then PPPFFFTT.

The issue in the OP and today's resurrection of the thread is where the deceased has split up with the other parent of their now adult kids and remarried.

It's usually a 'step' parent who has a right to reside.

That said my financial adviser was suggesting wills with some jiggery pokery along those lines for me/my partner of 41 years and Mother of our (adult) kids.

Going to get civilly partnered first then look at issues from that perspective.

Ah yes, didn't spoit it was a zombie. But my point is the same, it may be a step parent living in the property, but this was the deceased's partner or spouse. So it's perfectly understandable and normal that the deceased would have made provision for their partner in their will.

When my Dad died, the house became my step-mother's. He was married to her for 35 years.

To be fair you didn’t explain it at all well. Causing confusion with the ‘gifted to the children’ bit, etc. (did you mean ‘left in her will to her own children’?)

Leaving a house, or your share of it, directly to your offspring is a very sensible thing to do, IMO, especially when in a second marriage.

It is also reasonable to leave a surviving spouse a ‘life interest’, which it sounds as if your Mum has done.

I also think it would be reasonable to release the value, if that was possible at reasonable interest rates , but doubt that it is.

Men are often the older partner, and also have a shorter life expectancy 🤔

To be honest, I wish more people would do this. 3 of my friends had Dads who left everything to a much younger second wife who then left nothing to her step children.

Aaargh , fucking ZOMBIE THREAD

We are in a similar position but my Mum wasn't married to him.
Its a crap situation, he would be better off from a practical and emotional perspective in a home and before she died my Mum actually said that but he doesn't want to and we have no choice but to respect that. His daughter also doesn't want him to as it would use up all his money and there would be nothing left for her to inherit.
I don't like him and don't visit, I can't stand to see what the house is like since my Mum died and I feel we have no closure but we can't do a thing until he either dies or agrees in writing that we can sell.
He is 82 and not in great health so i suppose we just wait, my Dbro is desperate for the money, I am not as I expected that the house would be sold at some point to fund my Mums care so never thought I would get anything. My Dbro has tried all sorts to try and get around it but he can't