Joint Tenancy - Any rights for wife of one owner?

Tammykitty

My husband owns a house with a family member - they are joint tenants. The other family member lives elsewhere.


If I moved into this house with my husband would I have any rights to the property if my husband dies or if we spilt up?


We are considering relocating, but I am reluctant to move into this house as I believe I would have no security over my home if anything should happen, can someone confirm if this is the case?


Didn't know what board to post this in as its about home ownership, death or divorce! (So its in this and the home ownership board!)

TBagpuss

If you split up you would have aclaim against your husband's interest in the property.
If he died then the hosue would automatically pass to the other famikly member.

Your husband could 'sever the joint tenancy' y serving notice on the other owner. That would result in him, and the other person, owning a tenants in common. In those circumstnaces, if he dies you would inherit his half of the house (if he left no will, or if he left it to you) and could make a claim for his share of the house under the inheritance act if he made a will but left you nothing.

Tammykitty

The reason for the joint tenancy is for inheritance tax so it would pass directly to husband outside of the estate if the other family member dies, so they would be reluctant to change this I believe. (The other owner lives outside of the UK so its complicated tax rules)


Is a 3 person joint tenancy possible?

Keep_pedalling

As it stands if your husband dies first the other owner will own the property outright, so his first priority should be get that changed to tenants in common, which will enable him to pass his share over to you. This would protect the other owner's beneficiaries in the event that they died first.

Even when that is done you still don't have full security as the other owner could force a sale unless you could buy them out.

The other priority is to get up to date wills in place.

Keep_pedalling

Tammykitty wrote: »

The reason for the joint tenancy is for inheritance tax so it would pass directly to husband outside of the estate if the other family member dies, so they would be reluctant to change this I believe. (The other owner lives outside of the UK so its complicated tax rules)

If your husband died first it could cause his estate to have IHT issues, although the property would automatically pass to the survivor, it would still be included as part of your husband's estate for tax purposes.

You both need professional advice.

Tammykitty

Keep_pedalling wrote: »

If your husband died first it could cause his estate to have IHT issues, although the property would automatically pass to the survivor, it would still be included as part of your husband's estate for tax purposes.

You both need professional advice.

The property is valued at well under under the UK Inheritance threshold - so I believe no inheritance tax would be due if husband dies and it passes to the other owner.


However for the non resident owner. His estate being passed to my husband will be taxed at 30% due to inheritance law in his country of residence, however keeping the house in joint tenancy removes the inheritance tax from it. (I believe he did get professional advice at the time)


So I understand the reasons for the ownership of the house, and as Bagpuss confirmed above, I would have no rights to it in the event of my husbands death, but I would if we spilt up.

Kynthia

You would have some rights to live there as the matrimonial home, so your husband couldn't just lock you out one day, but look into that for the details.

As you are married, if you divorced all of your assets would be considered marital assets and factored into any financial settlement along with savings, cars, pensions, other properties, etc.

Joint tenants means that the whole property is owned jointly rather than as two shares. This means the property automatically goes to the other owner should one pass away. If you aren't happy with this then discuss it with your husband. Either it can be changed to Tenants in Common, where each share is left according to the will or intestate laws, or you could agree to get life insurance that would give you an equivalent amount should he pass away. Although the life insurance would cost money, it would give you funds to get somewhere else to live, and you could cancel it should the other owner pass away before your husband.

Keep_pedalling

Your husband's share of the property maybe below the IHT band but it will reduce the amount of the nil rate band that passes to you, so it could affect your estate in the long term.

If your husband wants to pass all his assets on to you he really should not risk you loosing his share of this house just to save someone else some tax.

Tammykitty

Kynthia wrote: »

You would have some rights to live there as the matrimonial home, so your husband couldn't just lock you out one day, but look into that for the details.

As you are married, if you divorced all of your assets would be considered marital assets and factored into any financial settlement along with savings, cars, pensions, other properties, etc.

Joint tenants means that the whole property is owned jointly rather than as two shares. This means the property automatically goes to the other owner should one pass away. If you aren't happy with this then discuss it with your husband. Either it can be changed to Tenants in Common, where each share is left according to the will or intestate laws, or you could agree to get life insurance that would give you an equivalent amount should he pass away. Although the life insurance would cost money, it would give you funds to get somewhere else to live, and you could cancel it should the other owner pass away before your husband.

Thanks for this - I had not considered the life insurance option before.


We also own another house, where we currently live, which is wholly in my name, and we are unlikely to sell it, so I would always have it, but it is 100 mile away and would likely be rented out, and would take time to sort. So the life insurance would give me the security to get a property quickly if necessary.


I actually believe the family member that owns the other half would look after me, if something did happen to my husband, but it is always good idea to have a fully secure home!

Tammykitty

Keep_pedalling wrote: »

Your husband's share of the property maybe below the IHT band but it will reduce the amount of the nil rate band that passes to you, so it could affect your estate in the long term.

If your husband wants to pass all his assets on to you he really should not risk you loosing his share of this house just to save someone else some tax.

Its not to save someone else tax, its to save himself tax (or get a bigger inheritance), as the family members estate will be left mainly to him.
The other owner is also a lot older, so it is unlikely that my husband would actually die first, but it is best to be prepared.

maman

I can't speak for the tax angles but DH and I own our home as tenants in common. We've done that as we have a DD each from previous relationship and want to legally protect their 'half' of the asset. However, in our wills it says that either of us (depending on who dies first) can live in the house as long as we wish so we can't be asked to leave for either DD to realise assets.


I really would recommend legal/financial advice.