Making a right to reside will

bjbyorkshire

I would like to ask if anyone can give me any information re making a "Right to Reside" will.  Husband and I have one son.  No other friends or relatives close enough to ask to be our executors so husband and son will be my executors and myself and son will be my husbands executors.  We already have wills in place from 2013 which name the solicitors as our executors alongside our son.  I now wish to alter this.  

We have been to see a local solicitor and he has given us the option of making right to reside wills.  Our aim is not to avoid care home fees but more to give our adult son a share in our home upon the first death.  He is single, doesn't own his own home nor does he seem to want to buy one.  Works away from home but uses this as his main address and residence.  

The right to reside wills info that the solicitor has provided seem to suggest that we put the half of our house belonging to each of us, we are tenants in common, into a trust with a wording which gives the survivor a right to reside for the rest of their lives or to sell and downsize if the so wish but they would need to consult the Trustees of this Trust.  Here's the part I dont understand.  Would the executors of our wills, i.e., husband and son for me, also be the trustees of the Trust?

Can anyone help me to understand the pro's and con's of this scenario please?

Keep_pedalling

This is quite a normal thing to do, and it will protect your son’s inheritance in the event of the survivor remarrying.
While the survivor still need the house the trust rather than your son own the other share so it does not effect your son’s first time buyer status or create a potential capital gains issue, which would be the case if you simply left he a share directly. 

bjbyorkshire

Thanks Keep Pedalling.  Does the survivor have to ask permission of the Trustees of the Trust if they want to move house. Who are these Trustees?  What happens to the surplus money if the house was sold and a smaller cheaper property bought.  Does son get less equity in the house?  What happens to the money left from the sale?
thanks

bjbyorkshire

The solicitor first quoted £250 for simple mirror wills leaving everything to each other and then to son.  If son pre deceased us then estate to be split between two charities.  He then said the cost would be £450 if we opted for Right to Reside wills.  Does this seem a fair amount for the extra work in drafting the right to reside wills.  I understand there is a bit more involved for him.  

I'm asking the questions here as the solicitor is one from the same firm as we previously used.  He was so quickly spoken and we both felt that we were dealt with courteously but with great speed to get us out of the office so that he could get on with something else.   I feel a bit reluctant to ring him up to ask these questions.  He didn't have an issue at all when I said I wanted to remove their firm as our executors  and subtitute with our son.  He did however read the old notes from severing our joint tenancy and wrote to us with details of something that he was completely wrong about so I do feel the need to be up to scratch with my info before we complete this process hence my asking you all rather than him at this time.

Many thanks

Keep_pedalling

bjbyorkshire said:

Thanks Keep Pedalling.  Does the survivor have to ask permission of the Trustees of the Trust if they want to move house. Who are these Trustees?  What happens to the surplus money if the house was sold and a smaller cheaper property bought.  Does son get less equity in the house?  What happens to the money left from the sale?
thanks

You could set it up so that on downsizing your son would receive any surplus from the sale of the original house. The trustees could be yourself and your son. 

Savvy_Sue

It could be worth phoning another couple of solicitors to get a quote for 'right to reside' wills - proper solicitors not will-writers! - to see how the £450 compares. But don't be afraid to go back with questions! 

bjbyorkshire

Thanks to you all for your advice.  I will phone a couple more local solicitors for a quote before I give the go ahead to this one and no, will writers are not something I would use, but neither do I want to pay more than is necessary.  I can see that there is a bit more work in drafting this kind of will.

Would my son have more difficulty sorting out a trust than he would sorting out a simple mirror will when eventually we have both died?  I read somewhere that it takes much longer for someone to finalise things when winding up a trust. I am trying to put things into place to make things as easy for him to sort out as possible when the time comes.  I am trying to get rid of the clutter and leave details of our financial affairs, house bills etc in a neat order for someone who has never had to deal with anything like this before and wouldn't have much idea of the processes which have to be undertaken.  
Thanks again.

Savvy_Sue

Only suggestion I can make is to let him help with the first death ...

Also just wondering if you and DH have set up Power of Attorney? Very strongly recommended.

bjbyorkshire

Yes Savvy Sue, He will need to be unvolved in 1st death but as a single chap living and working 240 Miles away with only sporadic visits to our house it wont be easy.

No, we havent done Powers of Attorney and I was surprised that the solicitor didn't ask that question and say he could do them for us for xxxx amount.  I do think we need them but from the Forum posts I think I'm capable of doing them myself.  It's just that I keep putting the deed off for another day.  
Thanks

getmore4less

Your house is clearly not his main residence with only sporadic visits

Giving a life interest to spouse, son does not get a share of the property it goes into trust.

Do you want to give son any rights?

Mirror wills with IPDI trust for a property are fairly common.


Having son as executor and trustee can make dealing with the property simpler when the time comes.

You can do a practice run next time he comes home
Plop the IHT205 in front of him and pretend you both died the day before.

bjbyorkshire

Thanks, Get More for Less.  I had not heard about IPDI trusts so had to Google it.  Not sure I understand it now I've read it several times.  

I can say that this is my sons only home.  He lives and works all over the country so his clothes, possessions, post, car insurance all use his/our home address.  He comes home when he has a long weekend or a holiday period and last year worked from here for 6 months.  He lives in short term rented accommodation when away which means that out of his salary he couldn't afford to pay rent and bills plus taking on a mortgage as a single chap.

The IPDI reading sounds as though this is used for cutting down on inheritance tax but in our case that will not apply and there would be no income or money in the trust to accrue anything that son may want to access.  It is purely a way of him having half of our house on the first death and half on the second death.  This I felt would give him some security and also mean that the survivor of us wouldn't be able to be moved out of the house by our son if he should decide it could be a good idea to sell his half share to a mate for £xxx who may then become the co owner of this property.  I don't think son would do this but who knows what goes on in someones mind when a large amount of money is dangled before their eyes.

I'm being ultra cautious, as is my way.  Trying to be a good parent and sorting our affairs out in good time for whoever is going to deal with our estate in the event of first death.  I could deal with things if husband was the first to go but he would definately not be able to sort things out without the help of either son or a solicitor.  He isn't interested in reading up on what is required as he thinks a solicitor would sort things out.  Yes they would but at what cost????

Do any of you good people think that us making simple mirror wills leaving half of the house to son but not putting it into a trust on first death would be a big no no?  It would mean registering the house in son and survivors names.

Thanks