How a Home Trust Can Protect Your Property and Legacy: A Guide for Blended and Multigenerational Families
How a Home Trust Can Protect Your Property and Legacy: A Guide for Blended and Multigenerational Families
Passing down property in a blended or multigenerational family can be tricky. Whether you want to ensure the surviving partner is cared for, protect your children’s inheritance, or maintain the peace among family members, a home trust might be the solution you need.
In this article, we'll explore the power of home trusts, how they work, and how they can help protect your home and legacy for future generations.
What Is a Home Trust?
A home trust is a legal arrangement that allows property owners to specify exactly how their property will be handled both during their lifetime and after their death. This is an ideal solution for families in blended or multigenerational situations, as it gives you the flexibility to ensure the home is passed down according to your wishes. A well-structured trust can:
Support loved ones for life by securing a place for them to live.
Create a clear plan for the future of the property or its proceeds when the primary resident is no longer living there.
Whether you’re in a blended family with stepchildren or part of a multigenerational household, a home trust can provide peace of mind by protecting both your home and your legacy.
Common Scenarios Where a Home Trust Can Help
Here are two typical situations where families benefit from a home trust:
Scenario 1: You and your partner own a home together, but each of you has children from previous relationships. You want to ensure the surviving partner has a place to live for the rest of their life, but after that, you want the property to be passed fairly to your children. A home trust allows you to create a plan that meets everyone’s needs, both for the present and the future.
Scenario 2: Your son is building an Accessory Dwelling Unit (ADU) on your property, and you plan to live there for the rest of your life. Once you’re gone, you want to ensure the property, including the ADU, goes to him without complications. A home trust can help make sure your wishes are followed, even as your family dynamics evolve.
How Does a Home Trust Work?
The first step in setting up a home trust is understanding how your property is currently owned. There are two primary forms of ownership that impact how a home trust can be set up:
Tenants in Common: Each owner holds a share of the property, which can be passed on to heirs or beneficiaries when they pass away. The problem? If the surviving owner can’t afford to buy out the deceased’s heirs, the property may need to be sold, even if the surviving owner wants to stay or is financially unable to move.
Rights of Survivorship: With this arrangement, the property automatically passes to the surviving owner. However, the surviving owner may face challenges if they want the property to be passed on to their children, potentially leaving nothing for the children of the deceased owner.
A home trust solves these problems by providing a customized plan for what happens to your home, allowing you to avoid potential conflicts and ensure the property is managed according to your wishes.
The Flexibility of a Home Trust
One of the major benefits of a home trust is its flexibility. Life circumstances change, and a home trust can adapt to those changes. For example:
If the surviving partner needs to sell the property or move into assisted living, the trust can allow for the property to be sold and the proceeds used for new housing or care.
If the surviving partner is financially stable and doesn’t want to remain in the home, the trust can direct at least part of the property to the deceased’s children, preserving fairness.
Managing the Costs and Responsibilities of a Home Trust
A home trust can also address the ongoing costs associated with maintaining a property, including:
Property taxes
Upkeep and maintenance
Utilities and insurance
Typically, the person living in the home will be responsible for these expenses. However, a home trust can allocate cash reserves to cover these costs, ensuring that the home is maintained properly and that there’s no confusion about who’s responsible for what.
Why You Need a Home Trust
For blended or multigenerational families, the complexity of property inheritance can be overwhelming. A home trust provides a clear, legally enforceable plan that can prevent family disputes, protect the surviving partner’s interests, and ensure the property is passed down according to your wishes.
At Two Spruce Law in Bend, Oregon, we specialize in helping families navigate these important decisions. Whether you’re looking to create a home trust, update an existing trust, or simply learn more about the process, we’re here to provide expert legal guidance every step of the way.
Contact Two Spruce Law Today
If you have questions about setting up a home trust or want to learn more, don’t hesitate to reach out to us. We’re passionate about helping families protect their homes and legacies. Give us a call or visit our website to schedule a consultation.
