Please help - RBS, a 77 year old, a £20K loan, and death...

paologray

Hi all,

Recently my Nan passed away (over Xmas). The funeral has been and gone and now we are going through the will and personal belongings.

Before I start, I am the Grandson and I'm mentioned in the will along with my brother under the "Gifts of Residue" section. The only other benefactor is my Mother who has been left the house and its belongings.

House - £100K value
Belongings - approx £2000
Residue accounts and life insurance - approx £4000.

We have all agreed that I will look after all of the details as my Brother is in a busy job and my Mother lives in Saudi Arabia.

Ok, now thats out of the way...

Going through the limited paperwork in the house and receiving letters in the post while she was in hospital, it appears that my Nan was granted a loan of £20,000 in November 2008 to be paid off over 84 months which is 7 years (for the record - we have no evidence on where this money has gone as my Nan shredded everything!).

She did all of her banking with RBS, they are even executors of the will (not for long though).

A few points:

1. She was 76 when the loan was granted and to be 77 in 5 weeks.
2. She was only earning £700 per month in pensions and benefits
3. The repayments were £350 a month
4. There was NO insurance, as they do not offer payment protection for over 74 year olds
5. The loan period was for 7 years - 7 YEARS!? She would have been nearly 84 when the re-payments finished.
6. It is not secured on the house. I have the land registry form here - No debts on the house.
7. November 2008? The height of the banking crisis?

I'm not concerned over where the money is. She could have given it all to battersea dogs home for all I care. What does concern me is the circumstances in which the loan was granted.

And now the bank are saying that the loan will have to be paid off out of the estate. I don't have that money lying around, and I don't want to have to sell the house to pay off a fishy loan which some slimey b*stard of a bank manger gave to my Nan because he earned commission on it to add to his already over-inflated income.

I'll leave it there for now, maybe someone has been in a similar situation and has had the debt written off? Maybe you had to pay? Maybe I have to pay? What can we do?

Any input/experience would be grately received.

Regards

Paul

ILW

I do not believe that you have any control over the estate, unless you are an executor.

paologray

I will be an executor within 4 weeks. Have applied to the bank to renounce their executor role.

noh

paologray wrote: »

I will be an executor within 4 weeks. Have applied to the bank to renounce their executor role.

Will they agree to renounce their role?

Debt_Free_Chick

As ILW mentions, this is an issue for the executor.

The executor will have no option but to repay all debts from the estate. The estate includes all assets, even though the house has been left to your mother. Essentially, the house can only be passed on if it is "unencumbered" i.e. free from all demands, charges & debts.

So the executor will have to "find" the money to repay the debts. Typically, this can only be done by selling the available assets. If your mother wishes to avoid the house sale, then she will have to consider settling the debts that the estate owes. Alternatively, she could simply take the net proceeds from the sale of the house after the debts have been paid.

In the situation you describe, it seems unlikely that there will be any "residue of estate" for you to receive.

Debt_Free_Chick

paologray wrote: »

I will be an executor within 4 weeks. Have applied to the bank to renounce their executor role.

Although this changes nothing - you will only have to deal with the same issues that the current executor faces.

Rafter

Paul,

If your Nan borrowed the money then it has to be paid from the estate and the house will have to be sold to pay the bank back, unless they will transfer the loan to your mother before the house is transferred.

I can't see any grounds for the loan being written off unless some sort of fraud has been committed. You should check the loan paperwork to make sure it is signed by your gran. I suggest you also ask RBS to provide you with bank statements around the time the loan was granted so you can investigate where the money went. The loan application should also state purpose of loan?

Good luck

R.

paologray

Thanks R.

Guys, I understand that if the loan is bonafide I'll have to pay it back.

But I smell fish, thats my problem. I see it as a terrible thing to give a loan to a 77 year old woman to be paid off over 7 years. It's irresponsibe banking if you ask me. Thats my question - What should I be looking for in the paperwork?

paologray

noh wrote: »

Will they will agree to renounce their role?

Unsure. But I've got good backing from a good solictior...

ILW

I would be a bit careful.
You could see the whole estate disappear in a load of lawyers costs.
Has it crossed your mind that if the lady wanted you to be executor, she would have apponted you in her will? I cannot see the bank giving up their fees without some sort of compensation

paologray

They want £100+VAT and a signed letter from me. Don't forget, my Nan comes from an era where there respected bank managers and solicitors. I see them as money grabbing swines who make money off of my back. I dont care if she wanted them as Executors, its not happening.