Complicated will - partners with kids

ButterCheese

Emmia said:

OP - you refer to your "partner" are you married/Civil Partners or are you not legally "tied" in this respect?

we're not married, just living in sin!  I've considered civil partnership if it might make things easier, but I guess our solicitor will advise further?

ButterCheese

Also forgot to mention, my partner has 2 boys who are now adults.  I have a son who is 12

poseidon1

From the details you have shared so far my observation is your unmarried fiscal circumstances seem to have evolved into an unholy mess.

As indicated by DullGreyGuy, what should have happened prior to completion of your joint house purchase , was that a tenants in common deed of trust should have been drawn up ( by the solicitor) which amongst other things should have outlined the basis upon which your mortgage contributions will accrue rising  equity in the home. Such deeds of trust have been considered de rigueur for unmarried house purchasers for many years, precisely to address the issue you are querying now.

Bearing in mind with repayment mortgages very little capital is paid off in the early years, you maybe harbouring an expectation that your entire payments ( interest and capital) have been accruing equity in the home, whilst your partner could equally have the view that only your capital payments contribute to increasing your equity share.

As for getting married or civil partnership, that would certainly be ideal from a tax planning point of view especially with regard to IHT where you are both currently at a disadvantage with regard to your current status.

Seems to me your visit to the solicitor would comprise separate elements. A pre nuptial financial agreement to regularise your financial arrangements of the past, a post nuptial agreement to determine how your assets should be split in the event of future divorce and of course wills ( after marriage ) setting out how your assets should be  fairly divided between your respective children when you both pass away.   Please note should you decide to put wills in place prior to marriage, those wills become null and void  after marriage under current rules, so some joined up thinking necessary here.

I would suggest you and your partner have a serious talk about these issues so that you are roughly on the same page, prior to expending expensive time with a solicitor to try and draft agreements you both will be happy with.

Savvy_Sue

Civil partnership could radically reduce any liability to IHT: what you leave to each other passes free. 

You do need to know what each of you is able to leave, poseidon1's advice is sound.

But before you get too forensic and rigid, what would you want to happen on your death, her death, the second death? She'd want her adult children to benefit, and that's easily done without putting you at risk of losing your home. And you want your son to benefit likewise. But would she continue to care for your son? Would you want either of you to be left counting every penny for the sake of being 'fair'?

BikingBud

ButterCheese said:

Hi All,

my partner and I are going to be making a will soon but want to thrash out some stuff before we go and see a solicitor.  But it's complicated - any suggestions?

My partner sold her house for 300k and we bought our new home together; we have 11 years left and around 60k left on the mortgage.  

We needed a mortgage to pay off my partners ex, and a small amount for moving costs.  The rest is a 2nd mortgage which we used to fix our roof, decking and garden.

We are currently both paying off my partners 12k credit card bills.

At the moment, most of the house belongs to my partner, but as I earn more and brought less debt to the new home, I think it's fair to factor in that I am "accruing" a bit more % of the house for each year that goes by.  I am also subtracting the 12k and 24k from her share for her credit card debt and paying off her ex respectively; I don't see that as a shared debt.

According to my calculations, byt the time the mortgage is paid off in 11 years, I would be entitled to 40% of the value of the house.  Does this sound fair?

As you appear to have joint accounts, a joint mortgage, on a house that may be equally split (tenants in common) or totally owned together (join tenants), you are paying off previous debts together then you appear to have merged all financial matters. All normal in a relationship.

Why would you now wish to unpick what you have allowed to occur?

If you are both fully committed to the relationship then what you (singular) might legitimately own in 5, 10 or even 20 years is wholly irrelevant, you both invested emotion into the relationship, the funding is by the by.

If you are not wholly committed then your "escape" plan might need some effort. If you wish to protect your contribution for your (singular) 12 year old son, you might wish to unpick and reset.

Either way you both need to sit together and discuss this. Bear in mind the discussion now, especially as it might challenge the basis of the relationship, might be more damaging than you expect.

madbadrob

ButterCheese said:

madbadrob said:

ButterCheese said:

madbadrob said:

ButterCheese said:

DullGreyGuy said:

So you bought the house as Tenants in Common rather than Joint Tenants?

What is the share according to your Deed of Trust?

This is nothing to do with wills though, as Tenants in Common you own whatever percentage the Deed of Trust says unless you failed to draw up a Deed of Trust in which case you own it 50:50. Her will will only deal with the percentage that she owns and your percentage is untouched by her will as it's not hers. 

Were you to update the Deed of Trust to be 60% hers, 40% yours then she could leave you some of her 60% if she wants or she could leave all of it to your most hated person in the world. 

As to if the 60:40 split is fair? You say what the purchase price was, you dont say how much each are contributing to the mortgage, you dont comment on how you came to the agreement of how much each contributes, you dont say if one or the other are making non-financial contributions etc. 

Our house is 50:50 with my partner, she doesnt work, I paid all the deposit, all the mortgage payments and if I die before her she will own it outright. To me thats fair but every couple is different and its for you guys to decide what's fair but really should be done before buying it as you'll need their consent to change the Deed of Trust else you are stuck with whatever it says.

Thanks for pointing this out.  To be honest I don't know.  We had a mortgage advisor who found us the best deal, we agreed.  I have not read the deed of Trust and didn't even know that was part of the paperwork!

As we have a joint current account, all of our earnings go into there, and all of our bills/mortgage/debt payments come out of it.  My 2200 a month wages plus 900/month from renting my house.  Her earnings plus pension is about 1700.  She inherited her old house (that she sold) from an ex.

Basically, as she put in the entire sale price for her house, I think 50/50 is unfair on her.  However, we are now jointly paying off her ex, and her CC debt to the combined tune of 36k which I don't agree should be a joint debt. 

Yes you are being petty.  Her smoking habit you knew about before marrying her and tbh as no bearing on this.  

No I agree the debt of her ex is not your debt and I am not even sure why you both are paying a credit card debt if the ex husband has died (assuming this from you saying she inherrited the house)  Are you saying the credit card debt was in both their names and that is why she is paying it off? 

You have shown that you dont know enough to give a decent response to this because if you are joint tenants in the house then the one partner who survives after the first death will own the house outright anyway.  As others have said if its tenants in common its owned 50/50 anyway.

Have you spoke to your wife about this?  What are her feelings on this matter?

Rob

Alright, no need to be rude.  I'm aware of my lack of knowledge so just trying to learn.  No her ex isn't dead.  They had 2 houses and rented out 1.  They divorced, she was given the smaller house which she sold.  The CC debt was built up because she lived on her own and didn't earn enough to live on

Sorry you feel I was being rude but so you know I wasnt.  The comment regarding not knowing enough is based on the not knowing how you hold the house in terms of joint or tenants in common not that your intelligence is low.  Thank you for clarifying the way the house came about it.  So in reality the credit card debt is your wife's assuming I have understood the replystating it came about because she didnt have enough to live after the divorce.  

So with fear of being called rude again you were aware of this debt she had prior to marriage and whilst you may not like it you really are helping your wife to become solvent again. So whilst I understand you're feeling aggrieved it will benefit you both going forward. 

Rob

Ok that's another way of looking at it, that I didn't consider. It's made me think now, I don't mind jointly paying off the CC debt but the payments to the ex are still out of bounds for me. Purely because it was her decision to pay him so he'd shut up and be out of her life, which again could have been avoided if she'd just blocked him! 

Thanks for another perspective 

Yes I think that would stick in my throat as well.  Is there anyway you both could refuse to make any further repayments to her ex as I am assuming this debt was his choice to accrue no matter how it came about?  If it would cause more friction between you and your partner then id say no more.

Rob

ButterCheese

Thank you all, this has given me a lot to think about. I guess I shouldn't be too obsessed with who is paying in what, as we both live here and contribute equally in our own way.

I do remember deciding at the solicitors that it would be 50/50 joint tenants.

My partners view is that I moved in with her knowing about all the debt, which is true, so I will get over it.

The 24 grand was the only sticking point. Basically, her ex through her out and gave her their rental property. He said she could have all of the child benefits (though not in writing), so she used that for 6ish years to help live.

When we moved 6 years later, he was harassing her via text, they argued, she verbally agreed to pay him back half of all the child benefit, so that was why we have a mortgage. But that is something she needed to do, I can't turn the clock back, so I'll need to get over it

poseidon1

ButterCheese said:

Thank you all, this has given me a lot to think about. I guess I shouldn't be too obsessed with who is paying in what, as we both live here and contribute equally in our own way.

I do remember deciding at the solicitors that it would be 50/50 joint tenants.

My partners view is that I moved in with her knowing about all the debt, which is true, so I will get over it.

The 24 grand was the only sticking point. Basically, her ex through her out and gave her their rental property. He said she could have all of the child benefits (though not in writing), so she used that for 6ish years to help live.

When we moved 6 years later, he was harassing her via text, they argued, she verbally agreed to pay him back half of all the child benefit, so that was why we have a mortgage. But that is something she needed to do, I can't turn the clock back, so I'll need to get over it

If you are correct on 50/50 joint tenant ownership of the house on purchase rather than tenants in common, you are aware that means on 1st death full ownership of the house reverts automatically to the survivor regardless of what Wills might state to the contrary.

I do wonder if your partner is aware that if she dies first, her half of the property may never be accessible to her own children, in the event you either then die intestate or choose to cut them out of your will. Of course there is a similar outcome if you die first ( ie your child potentially cut out of your half of the property).

Given there are children on each side ( whose exsistence surprisingly appear late in this thread as an afterthought) , seems you both have some planning to think about to ensure they are not unfairly disadvantaged by your joint lack of forethought with regard to the structure of the jointly owned property and lack of Wills.

ButterCheese

poseidon1 said:

ButterCheese said:

Thank you all, this has given me a lot to think about. I guess I shouldn't be too obsessed with who is paying in what, as we both live here and contribute equally in our own way.

I do remember deciding at the solicitors that it would be 50/50 joint tenants.

My partners view is that I moved in with her knowing about all the debt, which is true, so I will get over it.

The 24 grand was the only sticking point. Basically, her ex through her out and gave her their rental property. He said she could have all of the child benefits (though not in writing), so she used that for 6ish years to help live.

When we moved 6 years later, he was harassing her via text, they argued, she verbally agreed to pay him back half of all the child benefit, so that was why we have a mortgage. But that is something she needed to do, I can't turn the clock back, so I'll need to get over it

If you are correct on 50/50 joint tenant ownership of the house on purchase rather than tenants in common, you are aware that means on 1st death full ownership of the house reverts automatically to the survivor regardless of what Wills might state to the contrary.

I do wonder if your partner is aware that if she dies first, her half of the property may never be accessible to her own children, in the event you either then die intestate or choose to cut them out of your will. Of course there is a similar outcome if you die first ( ie your child potentially cut out of your half of the property).

Given there are children on each side ( whose exsistence surprisingly appear late in this thread as an afterthought) , seems you both have some planning to think about to ensure they are not unfairly disadvantaged by your joint lack of forethought with regard to the structure of the jointly owned property and lack of Wills.

So maybe this has all been nothing to worry about then i.e. if it's 50/50 then you are suggesting that we have no say in home ownership should one of us die?  We might have to draw something new up with the solicitor then, as my son would be ok (he could live with his mum, my ex) and also he'd inherit my other property which I now rent out.  But should my partner die, her boys would legally have no inheritance but for my goodwill.  Something to think about

RAS

Do you have LPAs in place? Please.

You both also need to think about what happens if either of you need care. That might be never but health can take a nose dive and you could end up with a situation where your goodwill isn't available because it would be considered deprivation of assets and you don't have capacity to give goodwill anyway.

Like wise, the rental might have been sold so unless you have a will, your son could get nothing.