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What to consider when placing property in your Will

There is plenty to consider when writing your Will and arguably your most valuable asset to include is your home and any other property.

Deciding who you pass your property onto can be difficult. You need to consider who would be the beneficiary or beneficiaries and how you would like them to receive that inheritance.

What are the ownership structures I need to consider?

If you are going to include property in your Will, there are different ownership structures to consider, and you need to make sure you understand the bracket you fall in.

The first to consider is sole ownership. In simple terms, if you own your property outright, you just need to confirm in your Will who the beneficiaries are, and the property will be passed on to them.

This differs from mortgage ownership which comes with different parameters for your beneficiaries. You would still be able to pass the property on to them, but they would inherit the mortgage on the property and would need to consider various options such as repaying or remortgaging.

It is also important to consider the factors of sharing ownership of a property and there are two variations of this. There is tenants in common and joint tenancy.

If your ownership structure is a tenants in common agreement, you can leave your share of the property to a person of your choice. That person will than take control of your share in that property alongside the other tenant, who maintains their share.

Whereas, in a joint tenancy agreement, your share of the property will pass to the other joint tenant automatically as it would no longer be your share to pass on to a beneficiary.

Understanding which criteria fits you will help you understand how best to include your home or property in your Will. It is always best to seek legal advice to understand your position before writing or editing your Will.

What if my beneficiaries are children?

If the beneficiaries of your property are children, there are certain legal obligations that you need to fulfil to ensure they can claim and receive their inheritance.

If your children are under the age of 18, you must put your property into a trust as they cannot inherit property until they reach adult age.

Your shares are transferred into that trust and the assets are protected by one or more trustees of your choice until your children are old enough to claim their inheritance.

There is a variety of trusts you can set up but it’s always important to consider the tax implications that come with setting up a trust so ensure you understand the options available to you.

How do Specific and Reversionary Bequests work?

Another important aspect to consider when including property in your Will is the idea of specific bequests and reversionary bequests.

A specific bequest is when you assign a particular asset, for example your home or property to a designated beneficiary. This means your Will clarifies who will be the beneficiary of the property in its entirety.

In contrast, a Reversionary Bequest is slightly different and is more appropriate if you have children.

A Reversionary Bequest is a form of legacy in a Will in which you can leave an asset to somebody for their lifetime but with the condition that asset goes to a secondary beneficiary upon their death.

For example, you can leave the property to your partner for their lifetime, but with a condition that the property passes to your children once they pass away.

A lot to consider but what is the best approach?

Property matters within a Will can be challenging because there is much to consider. There are plenty of options but it’s important you understand and decide what is best for you.

It is always best to seek legal advice when writing a Will and not rely on DIY Wills. Speak to an expert especially if you’re in the process of writing a Will, editing your Will or considering creating a Will.

Understanding the elements of including property will help you make the right decisions and understand your own position.

Our team will provide expert advice, support and answer your Will queries. Contact us today to find out more.