Do first home buyers need a will?

Buying your first home is a massive achievement. Once the celebration is over and you've settled in, there's another important step to consider. This step protects your new investment: creating a Will. After paying a deposit, many find their savings depleted, making the prospect of legal fees seem daunting.

This guide explains what a "first home buyers will" is, its importance for new homeowners, and how you can create one efficiently and affordably.

What is a first home buyers will and why does it matter?

A "first home buyers will" is not a unique legal document. It is a standard Will created at a significant financial milestone: the purchase of your first property.

A Will is an instruction manual for what happens to your assets (your "estate") and who takes care of any dependents after you pass away. Before owning property, creating a Will might have seemed like a future task. Now that you own a home, which is likely your largest asset, it becomes a necessity.

Without a Will, you die "intestate." This legal term means the government determines who inherits your property according to a fixed, one-size-fits-all formula. These rules may not align with your personal wishes, potentially creating difficulties for your loved ones, as this graphic illustrates.

Secure your property: How a first home buyers will protects your biggest asset

Buying a home is one of the largest financial commitments one can make. Leaving the future of that investment to chance is a significant risk. The law does not automatically assume your partner inherits everything or that your children are provided for. This can lead to difficult and costly situations for your loved ones.

When you don’t have a Will, state-specific laws, like the Succession Act 2006 (NSW), determine who gets what. For example, if a de facto couple buys a house together and one partner passes away without a Will, the surviving partner does not automatically inherit their share. They may need to go to court to prove the relationship, which can be a difficult process during a time of grief. The property's future could become complicated by legal procedures, and depending on the family structure, distant relatives could potentially make a claim.

In the rare event that you pass away without any eligible relatives, your entire estate, including your home, will go to the State.

Taking control of ownership and debt with a will

A Will allows you to take control. It enables you to name who inherits your share of the property, which removes ambiguity. This helps prevent confusion or disputes.

The mortgage is another important consideration for new homeowners. The debt does not disappear. A Will can provide clear instructions on how the mortgage should be managed. Should it be paid off from other assets in your estate? Or should the person inheriting the house also take on the loan? Your Will provides the roadmap.

A common concern is the potential cost, especially after a major purchase like a house. This concern is valid and a reason many people delay. However, modern solutions have made it more affordable to obtain a legally valid Will.

Preventing legal complications for your family

Having a clear, legally valid Will can be very beneficial for your family. It significantly reduces the likelihood of disputes over the property during an emotional time.

When there's no Will, your family has to apply for what’s called Letters of Administration to manage your estate. This process is generally longer, more stressful, and more expensive than the standard process with a Will (called probate). The extra legal fees can reduce the value of the asset you were trying to pass on.

It’s not just about money; it’s about the emotional toll. Not having your affairs in order can place significant stress on loved ones, forcing them to navigate legal complexities while grieving. As one person shared on Reddit, it's a case of being "penny wise and pound foolish."

Provide for your people: A will is about more than just property

Your new home is more than just a building; it's where you build a life and a future for your family. A Will is a tool to protect the people who live there, ensuring they are cared for according to your wishes.

Appointing a legal guardian for your children

For young families, this is often the most important reason to have a Will. If you have children under 18, your Will allows you to name a legal guardian, the person you trust to raise them if you are unable to.

Without a Will, this decision is made by the court. A judge who is unfamiliar with your family will determine who is best suited to care for your children. While the court aims to make the best decision, its choice might differ from yours. A Will ensures your children have the stability of being with the person you selected for them.

Protecting your partner

This is particularly important for de facto or unmarried couples. Although Australian law increasingly recognizes de facto relationships, a surviving partner may still need to prove the relationship to the court to claim their inheritance. This can be a stressful and costly process.

A Will removes that obstacle. By naming your partner as your beneficiary, you ensure they can remain in the shared home and inherit your assets without legal complications. Platforms like Willfully make it easy to name your beneficiaries, providing you and your partner with that essential security.

To control where it goes, you need to fill out a binding death benefit nomination form with your super fund. According to the Australian Taxation Office, this nomination legally requires your fund to pay your superannuation to the people you have listed. Your Will covers your house and other assets, while your binding nomination covers your superannuation. Both are needed to have your financial affairs fully organized.

How to create your will: A practical guide

The process of making a Will does not have to be complicated or expensive. Modern tools have made it faster, more straightforward, and affordable. Here is a practical guide to the process.

What to decide before you start

Before writing your Will, it is helpful to consider a few key roles. Consider your answers to these questions:

• Choose an Executor: Who do you trust to carry out your wishes? This person will manage your estate, pay debts, and ensure your assets are distributed correctly.
• Name Beneficiaries: Who will inherit your assets? This includes your share of the house, savings, car, and other possessions.
• Appoint Guardians: If you have children under 18, who do you want to care for them?
• List Assets & Debts: A general list of what you own (home, car, bank accounts) and what you owe (mortgage) is helpful.

  

Options for creating your will

There are two main paths: the traditional route with a solicitor or using a modern online platform.

A solicitor can provide tailored advice, which is beneficial for complex situations such as multiple family trusts or overseas assets. This service typically costs between $500 to over $2,000 and often involves scheduling appointments and a waiting period for the final document.

For most first-time home buyers with straightforward situations (owning a home, savings, superannuation, and personal items), an online platform is a viable alternative. It offers a combination of affordability, convenience, and legal validity.

Benefits of an online will for new homeowners

Online Will platforms have simplified the process. You can create a Will from home, on your own schedule, and at a much lower cost.

With a service like Willfully, the process is designed for simplicity. You can create a legal Will in under 20 minutes.

A common concern is the legal validity and security of an online Will compared to one from a lawyer. Platforms like Willfully include safeguards. Every Will is reviewed by a qualified Australian lawyer to ensure it is compliant and legally sound. Additionally, personal information is protected with AES-265 bank-level encryption.

Flexibility is another feature. Life circumstances can change, such as marriage, the birth of a child, or buying an investment property. Willfully includes 12 months of free updates to your Will, allowing you to make adjustments as your life evolves without additional fees.

Here’s a quick look at how the options stack up:

Buying a house is a monumental first step. The next vital move is protecting it. A Will is a plan to secure your property for the intended people, protect your partner and children, and prevent unnecessary stress and expense for your family.

Creating a "first home buyers will" is no longer a complex or costly process. It is an accessible, affordable, and simple task that can provide peace of mind. After working hard to acquire your home, this final step ensures it is protected.

With Willfully, you can create a legally binding, lawyer-reviewed Will online in under 20 minutes. It is a simple and affordable way to protect your new home and your family’s future.