Wills, Probate and Intestacy

Making sense of Wills, Probate and Intestacy

People often ask me, “How can a property show work on radio?” and my answer is very simple.  It’s all about getting the right guests.  Our sector covers so much ground and involves many different professionals and experts.  Making sense of Wills, Probate and Intestacy is likely to affect all of us at some time.

So I hear from lots of extremely interesting people.  Estate agents, solicitors, surveyors, internet experts, photographers, marketers and more, who have something to say.

Solicitors are essential for conveyancing matters, making sure all the paperwork is signed, sealed and delivered on time. However, they also have another major role to play in property matters.

‘Probate’ is a word that often comes up in the sale of an inherited property and often causes confusion.  Therefore, I thought it would be a good idea to talk to someone who knows all about it. That’s how Will Mumford from Healys came to be my guest on the show and answer all our questions.

Making sense of Wills, Trusts and Probate

Will Mumford works as a solicitor at Healys in Brighton in the firm’s private client department, covering wills, trusts, probates and general later life planning.

“I get the joke ‘Will the will’ a lot so let’s get that out of the way,” he laughs. “It does make me memorable.”

“Outside of work, I live in Brighton with my wife and young son.  In general I’m an avid rugby fan!  I enjoy hiking and getting out into the country as much as I can.  I used to enjoy going to pubs!”

“I’ve worked in law firms since graduating, and that’s been about seven years now.  Six of those years have been spent doing private client work, the same specialism that I do currently,” he explains.

“A will itself is classified as non-contentious law.  However, when things go wrong, when we’ve got aggrieved or disappointed beneficiaries, it can become contentious,” Will says. “If the will hasn’t been executed properly, that’s when it becomes contentious.  That’s when the litigators become involved.”

Probate

Wills and probate go together and this can be one of the most confusing areas for a property sale.  So I ask Will to give us an introduction to what probate is.

“We use the term probate as a bit of a catch all. It’s used generally to mean the process of administering someone’s estate,” Will begins.

“Specifically, a grant of probate is a court document.  It confirms who are the executors of the estate.  And it confirms that the will is the person’s last will and testament.”

“Once the court has issued that document it allows the executors (the people named in the document to access the deceased estate) to do things like sell a house, collect the money from bank accounts, pay off any debts and ultimately distribute the estates under the terms of the will,” he explains.

A grant of letters of administration does essentially the same thing but applies where a person dies without a will.”

Estates

“In general terms, if the value of the estate is low you might not need to obtain a grant of probate,” Will says. “The banks and building societies have their own requirements.”

“There’s no set amount, it’s not defined in law as to what amount a bank could release to you without a grant of probate, and what it is required to grant probate to release the money to you. As a general rule of thumb, something like £20,000 is typical.”

“However, if a person owns a property in his/her sole name, so if they own their own home as a sole owner, you’re going to need a grant of probate to sell it,” he adds.

“If a person owns joint property with a spouse or a partner, you may need a grant of probate depending on how the property was held. You would need to find out whether the property was held as joint tenants or tenants in common.”

This is an important distinction because joint tenants means the property passes automatically to the survivor.

“If it’s a tenancy in common, each owner holds a distinct share.  You need a grant of probate to deal with the deceased share,” says Will.

Reasons to make a will

“There are a lot of misconceptions out there about how an estate will pass if you don’t have a will.  People generally take the view that ‘it will work its way to my nearest and dearest’.  That’s not always the case,” Will points out.

“Unmarried couples, regardless of the length of time they’ve been together, even if they’ve got children together, aren’t simply entitled to inherit from their partner’s estate.  Unmarried cohabitees have no automatic inheritance rights,” he highlights.

“That’s quite shocking for a lot of people. You could have been in a 30-year relationship with your partner.  But if they die without a will, you’ll be entitled to absolutely nothing from the estate.”

Rules of intestacy

If you die and don’t have a will, the rules of intestacy are called into play.  I ask Will to explain this in detail.

“Let me start by setting up broadly what the rules of intestacy say about how an estate is distributed,” he replies.  “I can’t give you every single circumstance – they’re very complicated.  Even as an experienced solicitor, I need to check them whenever we come across new intestacy.  That’s because the rules are complex, and it very much depends on the family circumstances.”

“But as a starting point, if you’re married, your spouse will receive all of the estate if you don’t have children. So, for married couples with no children, everything does indeed pass to your spouse, as you would expect.”

“If you have children together, things get a bit more complicated. Your spouse is entitled to a statutory legacy of £270,000.  So the first £270,000 of the estate goes outright to your spouse, and the rest of the estate is shared equally between spouse and children,” Will explains.

“If anyone other than your spouse or a charity inherits money from your estate, there’s potential inheritance tax to pay so with money going to children, we are potentially looking at inheritance tax charges applying on your death.”

Inheritance Tax

Inheriting debts instead of wealth isn’t something that most people think about leaving behind them.  So what can you do to avoid this?

“With careful planning, you should achieve a nil inheritance tax balance on the first death.  So, when the first spouse dies, there should be no inheritance tax to pay.  We can do that by using the current exemptions with a bit of careful planning,” Will advises.

“Even worse, your estate could be dissipated if left to children under 18 and that’s what happens under an intestacy,” he warns.

“And that’s another good reason to put a will in place, to control at what age your children receive money from the estate. You can give the money to a trusted friend or relative to look after for your children’s benefit until they reach a certain age.  That’s the better way to deal with an estate, to leave it protected, so that it can be used for the children’s benefit in a sensible way.”

Steps to making a will

“Fundamentally, if you die without a will you have no say in where your estate will ultimately end up,” Will points out. “You’re leaving it to law, you are leaving it to the government to decide for you where your money will ultimately go.”

I recognise that writing a will is not necessarily straightforward.  Hence I ask Will if a solicitor with a specialism in wills and probate is the best route to take?

“Absolutely.  Look for a law firm that’s regulated by the Solicitors’ Regulatory Authority.  You can have confidence then that you’re dealing with qualified, insured and well regulated professionals,” Will says.

I have seen packs of wills in my local post office meaning that you can write a DIY will yourself. What are the dangers of doing that?

“The danger of drafting your own will is that if something goes wrong, the cost of putting it right is entirely for your estate to bear,” explains Will.

“If you choose to draft your own will, you’d only do it once in your lifetime, perhaps a couple of times with updates.  How do you know that you’re leaving your estate in a tax-efficient and sensible way?”

“For the very simplest of estates, it might be fine and perhaps in the majority of cases, it is fine,” Will admits.  “But if something does go wrong, the cost will be entirely borne by your beneficiaries. And anecdotally, I can tell you that we make a lot of money out of self-drafted wills because there is often something wrong with them!”

Positive outcomes

Although writing wills and planning for death is something of an unpleasant subject for many, I ask Will if he has any memorable moments that paint a positive picture of making a will?

“The one that stands out for me came quite early in my career.  I was working as an assistant in a law firm, part of the Probate Department, and a quite complicated intestacy arose,” Will remembers.

“There were several branches to the family tree, 30 in total.  Our task was finding all of the beneficiaries.  One gentleman had joined the French Foreign Legion in the 1950s following WWII and had disappeared for all intents and purposes!” he tells me.

“With the help of genealogists we tracked down this gentleman but sadly he had died.  This meant his children were the people entitled to inherit from the estate.”

“So I was able to get in contact with all of his children.  Whilst I had to break the news to them that we had found their long-lost now deceased father, we also ultimately handed them a cheque for a decent sum of money as well.”

I can’t help asking Will, what was the most surprising thing to them? That they got a nice cheque or that they found they actually had a family member that they didn’t know about? That must be quite something?

“Both came as a shock, but there’s another happy ending,” Will replies. “The beneficiaries were able to get in touch with long-lost half-siblings and I believe they are still in touch with one another, which is some more good that came out of it.”

Happy endings

That very touching, long-lost family story is a great way to finish up an enlightening interview on an otherwise quite sobering yet important topic.

You can hear me talk to more interesting guests on my Radio Reverb show ‘Let’s Talk Property’ broadcast on 97.2FM, DAB+ and online.

Do you have a story to share with us about making sense of Wills, Probate and Intestacy?  Contact me at heather.hilder@rwhilder.co.uk