Who inherits your home? The effect of a survivorship destination
Most people do not realise how much power a few words in their property title can have over their estate planning. In the 80s and 90s it was common to have survivorship destination in joint property titles. It was thought that when one of the owners died, the whole property would pass to the surviving owner automatically. But these simple sounding clauses can actually embed testamentary intent into the title.
What is a Survivorship Destination?
When two or more people buy a property together, the way they hold the ownership must be legally defined. In this article we will assume we are talking about a couple owning the property together.
There are usually two main options to consider when deciding how the ownership is shared (assuming the ownership is equal). The first option is to state the property is owned “equally between them and to their respective executors and assignees.” In this case when one owner dies, their share passes according to their Will. If there is no Will, the property will pass according to the laws of intestacy, which usually means to the surviving spouse under Prior Rights.
The second option is to state the title is owned “equally between them and to the survivor of them and to the executors and assignees of the survivor.” This means when one owner dies, their share passes to the surviving owner automatically, without any kind of formality. This mechanism is called a survivorship destination.
Survivorship destinations and Wills
A key point to note is that survivorship destinations take precedence over any instructions in a Will. This means if your title has a survivorship destination, it will take precedence over any testamentary provisions dealing with your share of the property. When one joint owner dies, the title transfers to the surviving joint owner immediately, regardless of what is in the deceased’s Will.
Evacuating a Survivorship Destination
If you want to regain control over what happens to your share of the property you can amend the title by signing a deed evacuating the survivorship destination. This legal step removes the automatic transfer provision. It then allows you to decide who gets your share of the property after you die.
You may still want to leave your interest in the property to your spouse or the joint owner, but doing so through a Will gives you more flexibility. For example, you could grant your spouse a liferent. This means they can live in the property during their lifetime and ownership will pass to your children or other beneficiaries after they die. This could be a more tax efficient estate planning strategy. It may also help protect the property from being counted as part of your spouse’s assets if they need residential care later in life.
Regain Control Over Your Estate
When you remove a survivorship destination, you ensure that you take control over your estate planning. It allows you to consider alternative arrangements that may better suit your long-term goals and offer more flexibility for your family’s future.
Specialist Property and Estate Planning Solicitors, Dunfermline
Stacey Parker deals with all aspects of estate planning on behalf of clients in Dunfermline, throughout Fife and across Scotland. Stacey has many years of experience in this area of law and is able to help and advise you on your options. If you would like to meet with Stacey to discuss your needs, just get in touch with us to make an appointment or give us a call on 01383 629720.
