Protective Property Trust Wills are Old Hat?
Protective Property Trust Wills are a traditional way of protecting at least part of the family home from MAD (marriage after death!!) They are sometimes called protected property trust Wills. At heart, these Protective Property Trust Wills use a “severance of tenancy” to change ownership of the home from “Joint Tenancy” where each person owns ALL of the property and automatically inherits if the other joint owner dies.
The “severance of tenancy” divides ownership into two halves, which are NOT inherited automatically by the survivor if one co-owner dies. Their Last Wills deal with that.
The Last Wills for the couple then give each person a life time right to live in the half of the property, and in most cases to move to another property. This right generally lasts for life.
Should the survivor remarry or run into debt or go into care, only half of the property belongs to them and can be taken by the Council or left by Will to a new partner.
The disadvantage of Protective Property Trust Wills is that probate is automatically required on the first death. This is a significant cost, which will usually be more than our Probate Home Protection Plan would have cost in the first place! Also, some professionals don’t fully understand how the protective property trust is intended to work. In most cases, the extra cost of probate means that our full Probate Home Protection Trust would be cheaper and much more effective.
Property Trust Wills have their place…
The exception, where Protective Property Trust Wills may well be more appropriate is for younger couples, perhaps unmarried, perhaps with previous marriages and children whose interests should reasonably need protecting. Here, the prime purposes is really to keep the home, generally the main asset, divided in a fair fashion. Property Trust Wills cost less, but for most home owners over 50 they remain second best in value terms. Our booklet gives more information.
Some call this type of Will Property Trust Wills, others a Protected Trust Will. Some firms include the Life Interest Trust under the same heading – that is where a person is left the right to live in the protected property for life. Effectively, a protective property trust Will where the property is NOT owned by the person being given the right to live in it for life.
We will be happy to discuss both Protective Property Trust Will and our own Probate Home Protection Plan if you are considering upgrading your Legal Planning.