Protective Property Trust

The protective property trust can be included in will documents and can be extremely useful in the following scenarios;

  1. If you die and your spouse/partner remarries, the new spouse could end up getting the house and your children could get nothing.
  2. Couples (married/unmarried) with children from different relationships. With a protective property trust each spouse/partner can decide who will benefit from their share of the value of the home (normally 50%) which will be held on trust for them until after the second death. Without this trust in place, there is a real risk that some children/step children could end up with nothing.
  3. Selling the family home to pay for care home fees. If a couple own a house as beneficial joint tenants, under a standard will, on first death the survivor will normally inherit 100% of the family home. If the survivor then needs long term care the local authority can then put a charge on the home to pay for care.  This could mean your beneficiaries end up with a reduced inheritance or in some cases nothing at all, depending on the length of time in care.

So how does a protective property trust work?

In simple terms, the trust works by making sure the surviving spouse never owns 100% of the property. On first death it will state that the first to die does not leave his/her share of the property (normally 50%) to the survivor. It will pass into a trust (held by your nominated trustees). It does however specify the following:

– right to occupy the home for the surviving spouse for the rest of their life
– right to downsize or move if needed

each spouse can be named as a trustee of the protective property trust.

If the local authority assess what the surviving spouse owns, they cannot take into account what has already passed into trust (normally 50%) so they can consider half the value of the home, not all of it.

How is this achieved?

We will produce the legal paperwork to change the way you own your property from “joint tenants” to “tenants in common” and also draft your wills with the protective trusts included.

During your home visit, a consultant can discuss this type of trust with no obligation to see if it is suitable for your circumstances and answer any questions you may have. Call today to book an appointment.