Table of Contents
1. Introduction
3. What Happens If You Don’t Have a Will?
6. How EHF Mortgages Can Help You Plan Ahead
Introduction
Planning for the future is about more than just financial security—it’s about ensuring your wishes are respected and your loved ones are cared for when you’re no longer around. This is where having a will, appointing a power of attorney, and understanding probate come into play. These legal tools can make all the difference in how your estate is managed and your family is supported.
In this guide, we’ll explore why creating a will is essential, what happens if you don’t have one, and the roles of power of attorney and probate in estate planning. Whether you’re just starting to think about your legacy or updating an existing plan, this article will provide the clarity you need. And if you are buying or refinancing a property, this is there ideal time to review your current arrangements,
Why You Should Have a Will
A will is a legal document that outlines how your assets should be distributed after your death. It provides clarity for your loved ones and ensures your estate is handled according to your wishes. Without a will, your estate may not be distributed as you intended, potentially leading to disputes or complications.
Benefits of Having a Will
1. Control Over Your Estate:
• You decide who inherits your property, savings, and personal belongings.
• You can also name guardians for any children under 18, ensuring their care aligns with your wishes.
2. Minimising Family Disputes:
• A clearly written will reduces the risk of disagreements among family members over your estate.
3. Tax Efficiency:
• A will allows you to plan for inheritance tax, potentially reducing the amount your loved ones will need to pay.
4. Appointing Executors:
• You can choose trusted individuals to manage your estate, ensuring your wishes are carried out.
When Should You Update Your Will?
• After significant life events, such as marriage, divorce, the birth of a child, or acquiring new assets.
• To reflect changes in your relationships or financial situation.
What Happens If You Don’t Have a Will?
If you pass away without a valid will, you are said to have died intestate. In this case, your estate will be distributed according to UK intestacy laws, which may not align with your preferences.
Intestacy Rules in the UK:
1. Spouse or Civil Partner:
• If you’re married or in a civil partnership, your spouse will inherit most, if not all, of your estate. However, they may not automatically inherit everything if the estate is worth over £322,000 and there are children involved.
2. Children:
• If you have children, they may inherit part of your estate, which could leave your spouse with less than intended.
3. Other Relatives:
• If you don’t have a spouse or children, the estate may pass to other relatives, such as parents, siblings, or cousins, depending on the circumstances.
4. The Crown:
• If no relatives can be found, your estate will go to the Crown.
Without a will, you lose the ability to:
• Choose who benefits from your estate.
• Appoint guardians for children under 18.
• Protect unmarried partners or stepchildren, who are not automatically entitled to inherit.
What is Power of Attorney?
A power of attorney is a legal document that allows someone you trust to make decisions on your behalf if you become unable to do so. This can include managing your finances, health, and welfare.
Types of Power of Attorney:
1. Lasting Power of Attorney (LPA):
• Property and Financial Affairs: Covers managing your bank accounts, paying bills, and handling property transactions.
• Health and Welfare: Covers decisions about your medical care, living arrangements, and daily needs.
2. Ordinary Power of Attorney:
• Used for temporary arrangements, such as giving someone authority to manage your finances while you’re abroad.
Why is Power of Attorney Important?
• It ensures your affairs are handled by someone you trust if you’re incapacitated.
• Without it, your family may need to apply for a court order, which can be time-consuming and expensive.
What is Probate?
Probate is the legal process of managing and distributing a person’s estate after their death. It involves validating the will (if there is one), settling debts, and distributing assets to beneficiaries.
How Probate Works:
1. Application for Probate:
• Executors named in the will apply for a grant of probate, giving them legal authority to manage the estate.
• If there’s no will, an administrator is appointed, and a grant of letters of administration is issued.
2. Settling Debts:
• Any outstanding debts, including mortgages, loans, and taxes, must be paid before distributing assets.
3. Distributing the Estate:
• Once debts are settled, the remaining assets are distributed according to the will or intestacy rules.
When is Probate Required?
Probate is generally required if the deceased owned property or significant assets in their name. However, small estates or jointly owned assets may not need probate.
How EHF Mortgages Can Help You Plan Ahead
At EHF Mortgages, we understand that estate planning can feel overwhelming. That’s why we offer expert guidance on wills, power of attorney, and probate, ensuring you have the tools to protect your loved ones and secure your legacy.
Our Services Include:
1. Comprehensive Will Planning:
• Tailored advice to ensure your assets are distributed as you wish.
2. Power of Attorney Guidance:
• Help with setting up lasting power of attorney to protect your interests.
3. Probate Support:
• Assistance with navigating the probate process, reducing stress for your family.
By working with our team, you can ensure that your estate is managed efficiently, providing peace of mind for you and your loved ones.
Conclusion and Next Steps
Having a clear and legally valid will, appointing a power of attorney, and understanding probate are essential steps in protecting your family’s future. Without these measures in place, your estate may not be handled as you intended, potentially leading to unnecessary complications and stress for your loved ones.
Ready to start planning your legacy? Contact EHF Mortgages today to book a consultation and take the first steps towards securing your estate and providing for your loved ones.
