if no will but deceased parent wants to give property to children and wife right to live in property

Keep_pedalling

Mimi_Arc_en_ciel said:

If your dad doesn't have a will, and his wife agrees, you could do a deed of variation where the inheritance is passed to you and by passes your mum entirely.  You could then have a contract drawn up to say that his wife remains in the property until she passes 

The OPs mother would be foolish in the extreme to do this, and the OP would be wise to block any such suggestion. I really struggle as to understand why anyone would think this would be in the OPs mother’s best interest. 

Soundgirlrocks

Your father needs to create a Life Interest Trust in his will - The wife has the right to remain living in the property (normally with a caveat that she will maintain and insure it), and the property is then held in trust for the beneficiaries so it doesn't affect your status as FTB. That's what my father did for me 

Keep_pedalling

Soundgirlrocks said:

Your father needs to create a Life Interest Trust in his will - The wife has the right to remain living in the property (normally with a caveat that she will maintain and insure it), and the property is then held in trust for the beneficiaries so it doesn't affect your status as FTB. That's what my father did for me 

“The wife” The OPs mother is not an object, and I think she has the right to actually own the marital home rather than just the right to live in it.

theoretica

If your mother gives you the house but continues to live in it then you will be liable for capital gains tax when it is eventually sold - as well as the issues of stamp duty and first time buyer privileges.  I think this may not happen with a properly written trust in a will, but it is not one to DIY.

onomatopoeia99

Malthusian said:

Life interest trusts are typically used when the deceased's spouse is not the other parent of the deceased's children, and they want to give some security to the spouse while still ensuring that the capital passes to the children eventually. 
The first rule of trusts is that a trust is something you set up when you don't trust the beneficiaries. In this case the "trust gap" is because A does not trust their spouse B to leave the property to A's children (B's stepchildren) in their own Will. (And none of this reflects badly on A or B, the family tree is what it is.)
But here the children appear to be the biological children of both A and B (or at least the OP hasn't said otherwise). Why does he want to leave the marital property in this way? Is it just something he's heard about other people doing? 
A life interest trust reduces the security of the spouse in order to increase the security of the children. Having a life interest is better than having nothing at all but it is not as secure as outright ownership. (You may be able to sell and move if you wish but you need to ask your own children - the trustees - for permission first.) 

Does the surviving spouse remarrying (and possibly later being divorced with resulting 50:50 split of "assets of the marriage" irrespective of who brought them to the marriage) affect this?

RAS

If the surviving parent remarries, then their portion of the beneficial interest would pass to the new spouse under intestacy rules. The surviving parent may want to write a new will, or not.

The first parent's portion remains with the children.

The will could address remarriage, if they wished. I'd suggest this is something the couple should discuss.

Malthusian

onomatopoeia99 said:

Malthusian said:

Life interest trusts are typically used when the deceased's spouse is not the other parent of the deceased's children, and they want to give some security to the spouse while still ensuring that the capital passes to the children eventually. 
The first rule of trusts is that a trust is something you set up when you don't trust the beneficiaries. In this case the "trust gap" is because A does not trust their spouse B to leave the property to A's children (B's stepchildren) in their own Will. (And none of this reflects badly on A or B, the family tree is what it is.)
But here the children appear to be the biological children of both A and B (or at least the OP hasn't said otherwise). Why does he want to leave the marital property in this way? Is it just something he's heard about other people doing? 
A life interest trust reduces the security of the spouse in order to increase the security of the children. Having a life interest is better than having nothing at all but it is not as secure as outright ownership. (You may be able to sell and move if you wish but you need to ask your own children - the trustees - for permission first.) 

Does the surviving spouse remarrying (and possibly later being divorced with resulting 50:50 split of "assets of the marriage" irrespective of who brought them to the marriage) affect this?

The house itself is owned by the trust, not the surviving spouse. However their life interest could be taken into account by the court in deciding how to split the marital assets. In theory, if the whole house is owned by the Trust then B's ex shouldn't receive a share at the expense of A's children, but B might have to cede a larger share of other marital assets in view of the fact that they can still reside in the house. And it depends on exactly what the Trust Deed says.
As RAS said the Will may have specific provision for the event the spouse remarries.
Anyone considering this kind of trust should speak to a regulated solicitor who can walk them through all these "what ifs".

flossymcfly

Forgive me if I have missed something here...but is this not just a way to avoid having to sell the home to pay for care home costs if needed further down the line? So the wife wouldn't be able to sell the home as she doesn't own it, but has security because of the lifetime interest?

RAS

Not exactly. If the survivor needs to go into care the house may have to be sold; it'll certainly feature in the social services assessment. Unless it is exempt for some reason, it will be sold and half the sum used to pay for care. If it can't be sold, they may put a charge on the house to cover the cost later.

Soundgirlrocks

Keep_pedalling said:
“The wife” The OPs mother is not an object, and I think she has the right to actually own the marital home rather than just the right to live in it.

Apologies I didn't mean to offend, was typing a quick response to the OP's first post and the post title says wife.

With regard to owning rather than living, it's sort of moot the right to live there protects the mother long term and also preserves the asset for future generations. If the father owns the property in his sole name it would be a very good way to prevent the assets from being eaten away by care home fees at a later date, (although this is less draining in 2025 when the saving cap rises to £100k) Living will trusts can be worded so if the mother wanted to downsize at a later date it can be accommodated in the trust.