When someone dies and leaves behind a property, the Executors or Administrators of their Estate will need to deal with any property that the deceased owned.
For free initial advice and guidance call our Probate Advisors on 03306069584 or contact us online and we will help you.
If you are an Executor or Administrator and there is a property in the Estate, there are three questions that you need to find the answers to:
- Did the deceased own the legal title to the property?
- How did the deceased own the property?
- Was the property freehold or leasehold?
Did the Deceased Own the Legal Title?
The way to check if the deceased owned the legal property depends whether the property was registered or unregistered.
If the legal title to the property is registered with the Land Registry, then the copy of the title will clearly show the names of the owner in the proprietorship register.
If the property is not registered then an inspection of the original Title Deeds needs to be made to prove how the title passed to the deceased.
How did the Deceased Own the Property?
If the deceased was named as the legal owner, the next question is: was he/she the only legal owner?
If the answer is no and a co-owner is still alive then the co-owner retains the legal title. The legal title cannot be split into shares. If there are, for example, two legal owners then both own the whole of the legal title. When one co-owner dies, their name is removed from the title and the other co-owner owns the whole of the legal title.
Consequently the deceased’s beneficiaries have no automatic or legal right to be added to the title. Instead, their interest in the property (if any) is purely in the equity or sale proceeds.
There are two ways to hold the equity in a property:
As Joint Tenants
When a property is owned as Joint Tenants, all owners own 100% of the property. So when one co-owner dies the equity automatically belongs to the surviving co-owner, along with the legal title. The deceased’s name is removed from the title.
As Tenants in Common
A Tenant in Common can own shares in the property. So again, while the legal title is owned as a whole, the equity can be split up. The equitable interest can pass to someone other than the co-owner – unlike where there are the Joint Tenants – but as stated above, this does not mean that the beneficiary is entitled to be added to the legal title.
When the deceased was the sole owner or the last surviving owner then a Grant of Probate will be required to deal with the legal title. When a Grant of Probate is needed to deal with a property, the Personal Representatives dealing with the Estate have two options:
- The property can be Assented, which means it is transferred to the beneficiaries of the Estate – provided there is no mortgage or any encumbrance that would prevent the transfer of the title
- The property can be sold – the net proceeds are then distributed to the beneficiaries of the deceased’s Estate and anyone else who has an equitable interest in the property, which can occur when the equity has been split.
If the deceased was not on the legal title but had an equitable interest in the property, then that interest remains equitable, which means that the deceased’s Estate has an interest in the value of the property but cannot sell it or assent the legal title.
Is the Property Freehold or Leasehold?
If the property is freehold then the property was owned outright, including the land the property is built on.
If the property is leasehold then the property and its land is owned for the length of the lease.
There may also be conditions on changing the ownership of the property. For example, the lease could be for a retirement flat and there could be conditions on who can own or occupy the property. Therefore if the beneficiaries of the Estate cannot meet those conditions – such as being over 55 years old – then the property cannot be Assented to them and the only option would be to sell the property to someone who does fit the lease criteria.
With our Probate Complete Service we take full responsibility for getting the Grant of Probate and dealing with the Legal, Tax (excluding VAT), Property and Estate Administration affairs.
To speak with a Co-op Probate Advisor call 03306069584 or contact us online and we will call you.