Secure your home with a Protective Property Trust
A Protective Property Trust can help you protect your share of the home and ensure that it is passed on to the people you care about.
What's going on
A major concern for many people is that their home may be used to fund care costs in later life. This may happen if you have just made a simple mirror Will.
Most people own their property jointly as Beneficial Joint Tenants, meaning that the house will typically be passed on to their spouse after the first death, and to their children or chosen beneficiaries after the second death.
Considering that over 60% of British seniors do not have a written Will, most of the remaining 40% have a mirror Will, which is not enough to protect their homes if one spouse passes away and the other goes into care or re-marries.
The proof for this are the 40,000 homes that are being sold by the Local Authorities every year to cover care fees.
A Protective Property Trust (PPT) has to be created whilst both partners are alive, to ensure that Mr and Mrs will own 50% of the property each, known as ‘Tenants in Common’. This is will stop the property from ever going to unwanted beneficiaries.
Without PPT
- Currently, anyone with assets above £23,250 (in England) or £50,000 (Wales) may not receive state help with care costs, meaning that families would have to sell their home to fund care.
- If you pass away and your partner goes into care, the Local Authorities will means-test 100% of the property and sell it to cover care costs. And with average care fees of £750 - £1000 per week, it does not take long to erode the value of your estate.
- If you pass away and your partner re-marries but then passes away also, your property will then be defaulted to someone else's children.
With PPT
- After a Protective Property Trust is incorporated in a new will, and then a spouse passes away, their share of the property will be given to the chosen beneficiaries, most commonly those would be children or grandchildren.
- If the PPT is established whilst both partners are alive, 50% of the property value is automatically protected upon the first death, meaning that the authorities CANNOT sell the house to fund care costs for the survivor.
- The surviving spouse will also benefit from a 'right of occupancy', meaning that they can still live in the property for as long as they want.
How does it work?
Yes. If the surviving partner remarries, the deceased’s part of the Will cannot be changed, thereby protecting the beneficiaries’ inheritance by preventing the deceased’s share passing to a new family, which is known as sideways disinheritance.
A PPT is also very useful for couples who have children from different partners. It will ensure each partner’s share passes to their child or named beneficiary whilst the surviving partner has the legal right to remain in the property for the rest of their life.
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