Everything you need to know about putting a house in trust in a will.
After years of steep mortgage payments, costly renovations, strenuous DIY — and beautiful family memories — it’s natural to feel strongly about what will happen to your home when you die. All that work, all that time … shouldn’t you get to decide?
By putting your property in a trust with a will, you can.
Why bother leaving a property in trust in a will?
When you make a will, you get to decide who will inherit everything you own: your savings, belongings and yes, your property.
Most of us want our partner to have the family home, and then for it to go to our children after that. And a will can help you do that.
But even then, there’s still a chance that someone else will get their hands on it. Council charges for care home fees, marriages, debts and family fights can all take the family home away, long before your children get to inherit it.
That’s where putting your house in a trust can help. It provides for your partner, while keeping the family home safe for your kids and grandkids.
How does putting your house in a trust with a will work?
So, what is a trust? It’s a way of letting someone benefit from something without owning it. Instead, it’s managed on their behalf by trustees.
Typically, that person is your partner, and the ‘something’ is your home.
After you die, your property goes in a trust. Your partner doesn’t own the home— but they can live there for the rest of their life rent-free. The property is managed by the trustees you’ve chosen. Like normal, your children will inherit the property after your partner’s death.
But because your partner and kids don’t technically own the property:
- The family home can’t be sold and the profit taken by the council to pay for your partner’s care home fees.
- Your partner can’t stop your children from inheriting the property (accidentally or on purpose) by making a new will or remarrying.
- Ex-spouses and creditors can’t get the property through a divorce or debt.
If you just left the property to your partner or your kids in your will, these would all be possible. The trust keeps the property safe for your family.
Who should consider leaving a house in trust?
Everyone with a home should think about adding a trust to their will. But it’s especially helpful if:
- You’re part of a blended family — If you or your partner have children from a previous relationship, you might each like to secure your part of the shared home for your children.
- You are (or your partner is) separated or divorced — Your spouse is entitled to inherit your estate until your divorce is finalised. After the divorce, you may be happy for them to stay living in the family home — but you wouldn’t want them to own it, as any new spouse would then be entitled to inherit over your children.
- You have children under the age of 18 — Putting a house in trust for a child means it can’t be accessed and sold by their guardians.
- You want to encourage responsible home ownership — With a normal will, your children would inherit the home at the age of 18. Not everyone is ready for such a big responsibility at that age. With a trust, you can defer their inheritance until they’re a little older.
- You want to protect the home. A trust means that your children’s spouses (present or future) wouldn’t be able to claim any part of the property in a divorce.
Putting a house in trust to avoid care home fees
This is the thing most people ask about.
When someone needs care, the council assesses the value of everything they own. If their home and savings are worth more than £23,250, that person will have to pay for their own care in full — until they have just £23,250 left. Care home stays cost over £30,000 a year.
What does that have to do with trusts?
If you died and left your home to your partner (no trust), and then they went into a care home, it would be included in the council’s care fee assessment. Your children’s inheritance could be chipped away at, year after year, and the family home may have to be sold.
But if you left your property in a trust, the council might not include it in their fee assessment. Your children could inherit the family home untouched.
Putting a house in trust just to avoid care home fees is not recommended. If the council thinks you’ve deliberately deprived them of funds, they may make a claim on the assets in the trust anyway. But it can be an added benefit for those making a trust for other reasons.
Selling property held in trust
Can your partner sell the house if you’ve left it in a trust? It’s up to you when you make the trust — but it’s recommended. Your partner might need to downsize or move to a more accessible property one day, after all.
Usually what would happen is that the new property would also be held in the trust. Any profit can be reinvested to give your partner extra income.
What’s the cost of putting a house in trust with a will?
Putting a property in a trust is quite complicated. It’s essential to get it right. If you’d like a property protection trust included in your will, it’s important to get professional advice.
At Beyond, we offer fixed-fee property trust wills for two people for £1,434.
This is more than our simple couple’s will (at £135) but in the long run it can save your family thousands.
Just give us a call on 0800 054 9793 for a free, no-obligation consultation about your needs. If you’d like to go ahead, we’ll set up a visit or a call (if you prefer) to finish it up. It’s quick, easy and professional.
Find out more about putting a house in trust
You can find out more about property protection trust wills here.