One question that we frequently get asked is “What happens to a property when someone dies?”. Following a bereavement, there are a number of tasks that need to be considered and ensuring that a property is dealt with correctly is one of the many responsibilities involved in estate administration. Coming to terms with the death of a loved one is a difficult and emotional process; therefore, it’s important to understand what to do with the deceased’s property to avoid any further stress and anxiety.
This informative blog post looks at who is responsible for a property when an owner dies, the different types of ownership that need to be considered, and what could be involved in dealing with a property after death.
Who is responsible for dealing with the deceased’s property?
The responsibility of dealing with the deceased’s property falls to the Executor (when there’s a Will) or the Administrator (when there’s no Will). This means that if anything happens to the property after the owner dies, they are responsible for resolving the issue.
Not only are they accountable for the property, but the entire estate administration process after someone has died. This involves following the wishes set in the Will or distributing the estate as per the rules of intestacy when there is not a Will. In addition to dealing with the property of someone who has died, estate administration involves selling and transferring assets, preparing tax forms, paying any Inheritance Tax due, and much more.
The role of an Executor or an Administrator is one that shouldn’t be taken lightly, as they are financially and legally responsible for the correct distribution of the estate. Executors and Administrators are not obliged to take on the responsibility, and they can choose not to accept the role if they wish. It’s also perfectly reasonable for Executors or Administrators to seek professional advice or to appoint a specialist to handle the estate on their behalf.
What are the different types of property ownership?
Before dealing with the property, it’s important to ascertain how the property was owned. It could be that the property was owned solely by the deceased, or they co-owned it with someone else, so the deceased only had a share in the property.
The requirements differ depending on the ownership of the property. If the intention is to transfer the property into the name of the beneficiary(s) and the deceased was the sole owner, the Executor or Administrator can transfer (assent) the property to the beneficiary(s) using a Land Registry form known as an AS1. It would be necessary to obtain a Grant of Probate if the property was owned in the sole name of the deceased, providing the Executor or Administrator with the legal right to either transfer it to the beneficiary(s) or to sell it. Learn more about probate and when it’s required.
If the property was co-owned, it’s necessary to identify if the property was held as beneficial joint tenants or tenants in common. Irrespective of the wishes in the Will or the rules of intestacy, if the property is owned as joint tenants, the property will pass directly to the co-owner. Typically, a DJP (death of a joint proprietor) form is used to register the death with HM Land Registry to update the Title Deeds (Land Registry entries) and remove the deceased’s name.
Tenants in common
If the property was owned as tenants in common, the deceased’s share will form part of their estate and must be dealt with in line with their Will or the rules of intestacy. If the estate is being left to the co-owner, then it will be necessary to use a DJP form (as above) and ideally remove the restriction that identifies that the property is held as tenants in common on the Title Deeds.
If the share in the property is left to a beneficiary(s) other than the co-owner, it will be necessary for the co-owner to transfer the property to affect the name of the new beneficiary(s) on the Title Deeds. This can be done using a Land Registry form known as a TR1.
If the property was co-owned (either as joint tenants or as tenants in common), there is no requirement to obtain a Grant of Probate to deal with the share of the deceased. However, we would always advise obtaining a Grant of Probate so that there is documentation as to what happened upon death, especially if there is a need to utilise either the Transferable Nil Rate Band or Residential Nil Rate Band when the person who dies has a pre-deceased spouse.
What could be involved when dealing with the property?
Organising specialist building insurance
Typically, when a property is left unoccupied for a number of consecutive days, restrictions and exclusions apply to the level of cover that is provided by standard home insurance. Policies differ between providers; whilst some impose restrictions after 60 days, others restrict their cover after 30 to 45 consecutive days. This response from insurance providers is due to an unoccupied property being at greater risk than one that is occupied.
At Kings Court Trust, we can source property insurance that covers the deceased’s property. In one case, we were appointed to take care of an estate which included a property that flooded shortly after we started the estate administration process; we were responsible for dealing with the aftermath of the flooding and our property insurance covered the costs, leaving more money in the estate for the beneficiaries.
Notifying utility companies
Utility companies should be informed of a death as soon as possible. Whilst this may not seem like a priority, every utility company has their set processes to follow. Once contact has been made, delays to payment requests can be put in place and accounts can be frozen. The sooner a company is informed of the death, the quicker they can ensure that supplies will not be cut off due to missed payments.
It’s important to note that although the Executor or Administrator is responsible for the administration of the estate, outstanding bills and debts to utility companies are normally paid from the deceased’s estate rather than from their own pockets.
Redirection of mail
As there may be information sent to the deceased’s address that requires immediate attention, it is recommended to act on this step as soon as possible. This can be done by filling in a special circumstances form and taking it to your local Post Office or applying by post. Unfortunately, this can’t be completed online, and a death certificate will be required. There can be a delay while redirection is put in place, so don’t worry if mail continues to arrive at the property for a short period of time.
If the property is to be sold, you will need to ensure that it has been completely cleared of all furniture and personal items prior to completion. Sometimes, this includes white goods and furnishings such as curtains. As this can be a very emotional and daunting task for those bereaving, professional companies can be instructed to clear the deceased’s possessions once documents and personal items have been retained by the family.
What happens to someone living in a house when the owner dies?
Again, this depends on how the property was owned and whether the surviving occupant is a joint owner of the property. If they are one of the owners, form DJP will be filled in to remove the deceased’s name from the register, as mentioned previously, and the surviving owner can continue living in the property.
If the person living in the property does not have any written agreement to show that they are a tenant, then they will not necessarily be able to stay in the home. In some circumstances, the deceased may have left the property to this individual in their Will, in which case they may be able to remain throughout the probate and estate administration process. However, this can be dependent on personal relationships, circumstances, and the Executor’s wishes.
How long after a death can a property be sold?
There is no time limit on when a property must be sold by. However, you cannot complete a sale until probate has been granted. It can be put on the market, and offers can be accepted, but the contracts cannot be exchanged beforehand. Therefore, it is unlikely that the property will be sold until at least six weeks after the death, although probate often takes longer than this.
Additionally, Inheritance Tax should be paid within six months of the death to avoid paying more in interest. Therefore, it’s best not to delay putting the house on the market too long, as Inheritance Tax forms must be submitted before probate can be granted.
In addition to handling the above tasks, Kings Court Trust can assist with additional property services as part of the estate administration. These tasks include:
- Evicting tenants
- Property and/or garden maintenance
- Repairing damage
- Re-decoration and cosmetic enhancements
- Property guardian (to live in vulnerable properties)
- RICS valuations
- Lock changes
If you have any questions about dealing with property as part of the estate administration process, get free guidance and advice from our Client Services Team by calling 0300 303 9000.
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