You’ve found a property you love, your offer has been accepted and you’ve appointed a conveyancer to handle the legal transaction. Now there’s a pressing question. Your solicitor asks you to choose between sole ownership, joint tenants or tenants in common – a decision that affects what happens to your property if you die or end the relationship with the person you are buying with.
Here are 6 things you must know about Wills & title deeds so you can make the right decision:
A Will is essential if you’re buying on your own: if you are going to be the sole owner of a home, your name will be the only one on the title deeds. As there is no co-owner, it will be your Will that defines who inherits the property.
If you pass away without a Will and with no surviving relatives, the rules of intestacy apply and your property may go back to the Crown in a process known as ‘bona vacantia’.
You could end up leaving your property to a friend by mistake: opt for an unsuitable type of ownership and your property may end up with the wrong person as an unintended consequence. To illustrate, if you buy a property with a friend using a joint tenancy agreement, they will automatically inherit your share of the home when you die – even if you leave your share to someone else in your Will.
If you don’t want the person you’re living with to inherit the property, opt for tenants in common ownership and use your Will to specify who should inherit your share. You can leave your share to more than one person, if that is preferred.
A Will may be rendered useless: although a Will is an essential document in cases of sole ownership or tenants in common, title deeds are usually a more powerful legal document in the eyes of the law.
Title deeds are the only way to 100% prove property ownership and executors/administrators of an estate are bound by law to accept what’s documented. What does this mean in practice? If an Aunt details in her Will that her niece should inherit her home, this wish will be ignored if the property is held as a joint tenancy with her surviving husband.
Your partner can inherit your home even if you’re separated: if your home is owned as joint tenants and there is no Will, a partner (married or civil) can inherit the property even if you are separated. This is due to the rules of intestacy, which apply when someone dies without a Will. Only divorce or the legal dissolution of a civil partnership will rule out an estranged partner.
There are options if you have separated. It is possible to change property ownership from joint tenants to tenants in common via a process called ‘severance of joint tenancy’. You can also convert a joint tenancy to a single ownership one but this may involve a financial settlement to buy the other owner out.
More than one name can appear on title deeds: a joint tenancy or tenants in common isn’t exclusively for couples. Up to four names can be included on a title deed, allowing siblings, friends and multiple generations to co-own the same property.
As outlined above, it’s critical to understand the difference between a joint tenancy and tenants in common in respect of automatic inheritance or named inheritance in a Will.
You may encounter a challenge: even the most watertight Wills and title deeds are not immune to a legal challenge. If someone thinks they have the right to a property where the owner has passed away, they can use The Trusts of Land and Appointment of Trustees Act 1996 to challenge what’s documented on title deeds or in a Will.
The person mounting a ‘beneficial interest’ challenge will need to prove they have financially contributed to the property, in the form of repaying the mortgage, covering the cost of household bills, funding an extension or paying for maintenance work.
We’re on hand to help you make the right ownership decision. Get in touch for advice and support.
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