Relatives in Care
Are you concerned about losing your property to care costs? OR
Would you like to leave your share of the home to someone other than your partner without your partner losing their home?
How this works
The property must be jointly owned as "Tenants in Common". Each partner leaves their share of the property (usually 50%) in trust for children or other beneficiaries rather than to the joint owner of the property.
This means that the survivor never becomes sole owner of the property which prevents the Local Authority including the whole value of the property when totaling assets if the survivor needs permanent residential care. So the most that could be claimed against is the survivor's half of the property.
Does half a property have a value? In 1993 the High Court ruled that because half a home cannot be sold or rented by itself, there was no value to it and a market valuation today may well follow this ruling. In which case, the value of the asset would be zero and the total value of the property protected.
Why a Protected Property Trust? As well as protecting the home, the Protected Property Trust safeguards the interests of the surviving joint owner, ensuring that the survivor has the right to live in the property without payment of rent for their lifetime. The Protected Property Trust is flexible and will allow the survivor to move home, buy, sell, upgrade and downgrade.
Only after the survivor dies does the first share of the property pass to the children or other beneficiaries. The survivor cannot be forced to sell or move without consenting. The Protected Property Trust can also protect the residential rights of a current partner if the property share is to be left to children from a previous relationship or other beneficiaries.
If any of this sounds familiar then you need to arrange an appointment with one of our Wills & Estate Planning Team as soon as possible.
JOINT TENANCY
The joint owners of land and property in England & Wales can be registered with the Land Registry in two ways: 1) Joint Tenants or 2) Tenants in Common.
The majority of homes have been purchased as Joint Tenants, this term means that both parties jointly and severally own the property, and as such, if one tenant were to die, the surviving Joint Tenant(s) automatically become the owner(s) regardless of any Will or other instruction.
This means that upon death a share of property owned as Joint Tenants cannot pass to anyone other than the surviving Joint Tenant as there is no quantifiable way of establishing a defined percentage owned. This may not be in accordance with instructions expressed in a Will and could have serious implications for any inheritance tax liability.
Tenants in Common means that each Tenant in Common owns a defined share of the property, generally 50%. Upon death the share passes according to instructions in the Will or the Law of Intestacy if the owner is without a Will. The property share can be left directly to other beneficiaries, for example children from previous marriages or split amongst various beneficiaries other than just the joint owner.
Whilst owning your property as Tenants In Common may appear more flexible, it is important to remember that by defining a share of a property the law will require all signatures of all owners to sell or borrow against such a property. Should one partner, in the event of illness become incapable of handling their affairs, without an Enduring Power of
Attorney the person's estate would have to go into receivership (see section on Enduring Power of Attorney) before any changes could be made. An Enduring Power of Attorney for both parties should be considered as a necessary document when owning a property in this manner.
It is possible to change the manner in which ownership is registered at the Land Registry we are able to carry this out on your behalf.
Don't delay, protect your assets.
Call NOW on: 07967 595454 or contact us today to arrange a Call Back.
Speak to Mat Lee (Head of Wills & Estates)
North Mortgages
