The family home might be one of the largest assets in your estate. More than this, it likely holds memories and significance to those you’ll leave behind.
Thinking about what happens to the family home can save disputes at a later date, where emotions run high, conflict risk higher, and unresolved assets can create a family headache.
More than at an emotional level, a plan for your family home will also ensure a smooth transition of ownership after you die. Even if there's no sentimental value in the property, this planning ensures an efficient home sale and quicker support for those important family members, just when it matters most.
We’ll assume that if you're reading this you’ve got the foresight to be writing your Will. However, even if this is the case, there's a few different pathways to choose from. Let's take a look below:
1. Family Home Transferred According to Your Will:
A family home will typically be transferred according to the wishes stated in a valid Will, whether that's to a specific beneficiary or divided among multiple.
2. Sale of the Family Home:
In certain cases, the family home may need to be sold to settle outstanding debts or distribute the proceeds among the beneficiaries. If you die with significant financial obligations, then this may be the inevitable outcome. There may also be cases where no family members are looking to move in, and a sale will still occur.
3. Co-Ownership by Multiple Beneficiaries:
If you leave the family home to multiple beneficiaries, they may become co-owners of the property. This then leaves several options on how to manage the home; such as deciding whether to sell, buy out other beneficiaries, or continue co-owning the property.
4. Payment of Outstanding Debts:
Before the family home can be distributed to beneficiaries, any outstanding debts in your estate must be settled. If you die with significant debts, the proceeds from a home sale may be claimed by creditors.
5. Dispute or Contestation:
In some cases, disputes or contestations may arise among potential beneficiaries regarding the family home's ownership or distribution. This can lead to legal proceedings or mediation to resolve the conflicts and determine the rightful ownership or division of the property.
Whilst it's possible to divide the family home between multiple beneficiaries, there's certain practicalities to consider. Knowing whether family members want to move in or sell up can impact this decision- with multiple beneficiaries making more sense if the goal is to split proceeds between a sale.
With this in mind, it’s important to clearly define the percentage of share or ownership each beneficiary will receive. Leaving clear instructions helps to prevent conflicts or ambiguity, and helps clear any legal or tax implications ahead of time.
If you pass away without a valid Will, the laws of intestacy in your jurisdiction will dictate how the family home is distributed. Whilst these laws typically prioritise immediate family members, such as spouses, children, or parents, this may not align with your specific wishes and can create more family debates.
So- if family support, peace of mind and legacy protection weren’t incentive enough- write your Will today with the knowledge your family home plan is protected.
Safewill provides the most affordable way to write your Will and protect your assets. Our online platform makes estate planning easier than ever before, with simple features to appoint an executor, choose a POA and outline beneficiaries for specific assets you leave behind.
To find out more, reach out today on 1800 10 33 10, or via live chat now.