Don’t leave your estate to chance – draft will today
When someone dies, disputes over legal ownership of the family home can potentially tear families apart, especially if the deceased had no will.
Where certain family members have lived with the legal owners before their death and have invested in home improvements out of their own pocket, the scenario becomes even more complex.
If the owner dies without a will, relatives living elsewhere will have a legal claim on the house, meaning the child who had been living with the owner may in fact not be entitled to direct compensation for any home improvements he or she had made.
Anyone living with an elderly relative in a house they believe they’re entitled to inherit, should discuss this while the property owner is still alive.
Unfortunately, acts of kindness are not rewarded under the law, so you cannot assume that because you spent years of your life nursing your parents you will automatically be compensated after their death.
Sanlam suggests the following pointers:
1. Make sure there is a will While drawing up a will may sound unnecessary to someone who doesn’t have vast sums of money, it can save everyone years of angst.
Drawing up a will with the help of a professional will detail exactly how the estate should be divided so that there are no surprises later.
Not only can this save a huge administration burden – winding up an estate without a valid will can be a prolonged exercise spanning many years – but it can also avert potential family feuds and heartache.
2. Have the house transferred into your name before the owner dies
If you are definitely entitled to the house you are living in and there is no dispute, you could consider putting the house in your name before the owner passes away.
The owner can effectively gift the house to you with no money exchanging hands. Donations tax will be payable, but it is worth considering this route to prevent any complications later.
3. Get written consent for upgrades
If you are living in a house and are paying for upgrades, you should ask for written consent from the owner.
This will permit you to claim against the estate for those upgrades after the owner dies, provided you kept records of the expenses.
This applies to potential heirs as well as long-term tenants.
Even when doing everything right, you can still come up short if you are investing in a house but are not completely certain that you’ll get sole ownership or compensation after the owner passes.
Getting expert advice, and having frank discussions upfront, will go a long way to ensuring peace of mind for all concerned.
Contact Sticks Stiglingh at Strata Financial Solutions BlueStar on (046) 624-4948 / 071-612-7339 or sticks@stratabluestar.co.za for professional advice.