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What Happens To Your Home When You Die?

Amy Peters
06 April 2022 14 min read

There are lots of assumptions about what happens to your house or the family home after you die but without the correct planning in place, it may not be as straightforward as you might think. So what do you need to keep in mind and how can you ensure the correct people benefit from your property?

There are a few things you may wish to think about.

Is there an outstanding mortgage?

Unless insurance is in place to pay off a mortgage in full when someone dies, the monthly payment will still need to be paid. If the remaining mortgage is small, the beneficiary may be able to take on that debt. But, if there is a large mortgage outstanding, and the beneficiary cannot afford the repayments, the lender is likely to require that the home is sold. If you need some guidance on life insurance or other financial aspects, get in touch as we work with some great financial coaches who can provide guidance.

Whether the deceased owned the legal title to the property

When someone owns a property, the legal title – registered with the Land Registry – will clearly show their name as the owner. If the property is not registered correctly, an investigation will have to take place to prove how the title passed to the deceased before it can be given to the intended beneficiary. Where property has been owned for a number of years, it may not have been registered when it was purchased and this can cause significant delays when probate is required. If you’re not sure where you stand, get in touch and we can complete a free Land Registry check for you.

How the property was owned

In England and Wales, when a property is co-owned (e.g. by a husband and wife), the way it is registered will impact what happens to it when one owner dies.

There are two ways to own a property with someone else:

As joint tenants: This means both (or all) owners own 100% of the property. So, when someone dies their name is removed from the title and the home automatically belongs to the surviving co-owner(s). The home can only pass to that co-owner and to no one else.

As tenants in common: This means each owner owns shares in the property. These shares can be for the same, or different amounts. When someone dies, that person’s share can be left to someone other than the co-owner.

Is the property freehold or leasehold?

If a home is a leasehold, there will be an agreement from the freeholder (sometimes called the landlord) to use it for a set number of years. With a leasehold, there might be conditions on who can own or occupy the property, and this can prove problematic when leaving it in a Will.

If the property is freehold, things are more straightforward. The property and the land it is built on are owned outright and can be passed on however the deceased wished (as long as they are the sole owner).

Is there a Will in place?

If someone dies without leaving a Will, the state shall decide how your estate is distributed and this may not reflect what you wanted to happen. The best way to make sure your house goes to those you want it to, is to write a Will.

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