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Nerdy Note: Do debts die with you?
in MoneySaving polls
35 replies 25.5K views
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I did not pay full market value, not by a long shot. I paid off his and my nan's equity release loan so he received no extra cash from me. And no, he is not charged rent!!!!! Its the old rule of surving 7 years a gift of deed and all that,the law sees that he has given his shackels away as if the house had been sold, he would have received at that time £200k from the proceeds.
And yes, as I am sure you know, if he dies within 7 years of the gift then that gift is subject to inheritance tax.
There is a 'pecking order' for debts, which is :
secured debts - eg mortgage
privileged debts - eg funeral expenses, admin costs of probate, wages owed to employees, some types of tax
ordinary debts - everything else
So no you can't choose the order
What about an order within that pecking order? E.g. if you still had assets left after clearing your secured debts and your privileged debts, but not enough to cover all your ordinary debts and you had a loan in your name and a loan in joint names?
(Only asking out of interest, btw)
Would they count the x-box as an asset?
From what has been said, you are in no way liable for this debt.
But if he had been paying it off and they are happy to accept a reduced figure in settlement, would it be easier for you to pay this in this difficult time?
(I'm not saying yes or no, just asking the question. I don't know how easy it would be for you to pay this. But I can also see that you wouldn't want them snooping around right now.)
ytility bills etc though may be treated different- the surviving family may get cut off, if they dont carry on paying?
Sometimes seen lurking on the compers forum :-)