Congratulations! You’re a homeowner. This is a scary time of spending and mortgages and solicitors and estate agents.
Has it crossed your mind what will happen to your house – and your mortgage – if anything were to happen to you?
Am I legally required to make a will when I get a mortgage?
No, you are not required to make a will when you get a mortgage. But that doesn’t mean you shouldn’t do it.
A will is a great way to settle disputes if anything were to happen to you and your family were left to decide who gets the house. You might think this wouldn’t be a problem, that your family will instead be mourning your tragic loss and far too busy with that to worry about your house, but history has taught us that this just isn’t true.
Your family might also have a very different idea as to who gets your home than you do. For your own peace of mind, you will want to make sure that those you love most receive what you believe they are entitled to in the event of your death.
What happens to my mortgage if I die?
If you have a mortgage, it is highly recommended you get life insurance. Your policy should state that if you die your mortgage will be paid off, even if you only have a small amount of equity in it. That will mean that the benefactor of your house will be given a mortgage free property to do with as they will.
If you do not have life insurance and you die, your lender will expect the mortgage to be repaid. This usually means that the house must be put up for sale and sold on.
What will happen to my house if I die without a will?
You might presume that you don’t need a will because your assets, including your home, will pass on to your next of kin automatically, but this isn’t always how it works.
The law can determine who owns your estate and there have been instances where family members are left with nothing and the government owns everything, so it is important you check your individual circumstances with a solicitor and make sure you have everything in order, so that your home goes to people you care about.
How do I get a will?
When you draft a will, you will list all of the assets you have that you want to pass down.
There are lots of free will builders online, but you should use these cautiously. It is a much better idea to speak to a solicitor about what you own and how you want these items handled if anything happens to you.
Your solicitor will help you determine which of your loved ones is best placed to execute your will should you pass away.
They will also help you foresee any potential issues and help you to solve these as far as possible in advance, so you can go about enjoying your life safe in the knowledge your wishes will be granted on your death.
Even if you have a will in place, it is important to recognise that there may be inheritance tax to pay. It is most likely it needs to be paid within 6 months from the date the individual passed away. You will not have to pay this if the property is worth less than £325,000.
You can, however, gift your property to someone to avoid paying this tax. You can only give your home to your spouse, a UK charity, a national institution, or a UK political party.
Again, this is something you should tie up with a solicitor. They will make sure the wording is legally sound and there are no loopholes that could cause complications when it comes to distributing your estate.
Once the will has been written, it will be permanent unless you decide to change it or draft a new one, so it is important you keep on top of this as your circumstances change.
JMR Solicitors can help
JMR Solicitors can help you secure your home through a will. Our expert solicitors will guide you through the process of writing a will, selecting an executor, and distributing your assets equally, with the correct terminology to limit complications in the unfortunate instance of your death. We’ll give you peace of mind.
We’ll also advise you on ways to limit inheritance tax, to make sure those you love are getting the best of you when you are no longer with us.
For more information and to speak to a friendly and informative member of our team, email email@example.com, or call 0161 491 3933.