Should I put my home into my childrens’ names ?
Are you thinking of putting your home into your children’s names?
There are some pros and cons to making a gift of property to family members.
Let’s look at some of the reasons why you might want to give your property to your children and some of the points you must consider if you’re going to avoid problems.
1. Your child/children live with you and share the bills
If your children live with you and have no property of their own you might want to ensure they will have somewhere to live after you’ve gone.
2. You’re worried the property might have to be sold if you go into a care home
Many people are concerned that the local authority will force their family to sell the family home to pay for care fees if it is still in their name when they move into a care home.
3. You run a business or have a lot of debt
There are financial risks associated with running a business. You might want to try to protect assets such as the family home by transferring ownership to another family member.
4. You’re living with a partner who is not a parent of your children
Your children have warned you that your partner could take the property if your relationship breaks down.
5. You’ve heard it could save probate fees when you die.
You want everything to be as straight forward as possible for your family when you die and you’ve heard that putting your property into your children’s names while you’re living can save on probate costs.
These are some of the reasons why you might want to transfer your property to your children. So what type of things should your consider before you take that step?
Reasons not to put your home into your children’s names
- You might change your mind later
It’s important to remember that once you have made the gift it might be very difficult to get the property back if you should change your mind.
- Deliberate deprivation of assets
Transferring a property with the intention of avoiding paying care fees or creditors can be regarded as a deliberate deprivation of assets and could be challenged by your local authority or by creditors.
- Managing relationship breakdown
Property disputes are common when couples split-up. If you’re going to transfer your home or a share of it to your children it could affect your partner or ex-partner or their children. Find out first what occupation rights would be involved. Remember that your partner might be able to make a claim for financial provision either while you’re alive or after you’ve died even when you have transferred your property to your children.
- Saving probate costs
There are a number of companies who are pedaling the myth that transferring a property to children will save on probate costs.
Very often the arrangements suggested as a solution are quite complex. They involve putting the property into a trust. Although in some circumstances there may be advantages to using a property trust, very often the charges made by some companies are just as high or even higher than the probate fees.
These are just some of the considerations if you are thinking of giving your home to your children. As ever, the best course of action is to take advice from qualified professionals who can discuss all the options with you. Call us on 0115 7722129 for more information.