Advice barclaycard debt following death

mack1969

zzzLazyDaisy wrote: »

Hi Mack, I am sorry for your loss.

I take it this endowment is connected with the mortgage?

If so it would have been written in trust with your Dad being the named beneficiary, so no, it doesn't go through your mother's estate.

I would send the death certificate to the CC company with a letter explaining that she died intestate with no assets of her own. They may not like it and you or your father may get letters suggesting that you/he is responsible for the outstanding debt, but this is simply not true.

thanks.

that is the train of thought i had about this.

chattychappy

zzzLazyDaisy wrote: »

explaining that she died intestate with no assets of her own.

She was a joint owner of the house when she died so I would be very careful about how I word the letter - at the very least she had an interest in property immediately prior to death.

We don't know how the mother held her share of the house, although the OP did write "the house was joint so that passes onto my dad" - so if this means it was "joint tenancy"then agreed it doesn't go into the estate. But it does sound a bit like an assumption on the OP's part. If it was held as tenants in common, then of course it would go into the estate and be available.

OK let's assume it was a joint tenancy so passed outside of the estate:

zzzLazyDaisy wrote: »

They may not like it and you or your father may get letters suggesting that you/he is responsible for the outstanding debt, but this is simply not true.

It now CAN be true because of s 421A Insolvency Act 1986 (amended in 2001). This provision was brought in precisely to catch the situation where an estate is insolvent by virtue of assets (particularly property) passed by joint tenancy, but court orders are needed.

In particular, an insolvency administration order must be obtained (s421A(1)(a)) within 5 years of death (s421A(1)(b)) and immediately before death the person must have been beneficially entitled to an interest in property (s421A(1)(c)). Then a further order can be obtained requiring the survivor to pay to the trustee an amount not exceeding the value lost to the estate (s421A(2)) but with regard to any exceptional circumstances (s421A(3)).


From the government's website: http://www.insolvency.gov.uk/freedomofinformation/technical/casehelpmanual/D/DeceasedInsolvents.htm

vii What happens to property that was owned under a joint tenancy by the deceased debtor prior to his/her death?

The deceased debtor's interest in property owned under a joint tenancy will pass automatically to the other joint owner or owners by right of survivorship, and will never become part of the insolvency estate.

The trustee may seek to recover the value of the deceased debtor's interest in the property that has been lost to the estate by making an application to the court under section 421A. On the application of the trustee the court may make an order requiring the surviving partner to pay to the trustee an amount not exceeding the value lost to the estate. Section 421A came into force on 02 April 2001 and applies where an insolvency administration order has been made in respect of the deceased debtor and the petition for that order was presented within the period of five years beginning on the day on which he/she died.

Of course whether they will bother with all this is another matter!

Clarification added
To answer the direct question NO, if the endowment policy is written normally it's not part of the estate. YES they could make a claim on your father, BUT they cannot do that until they have obtained the necessary s421A court orders.

louielouie_2

Hi there
I am sorry to jump on this thread but was trying to do a little research and come across this post. First time I have posted so apologies if I am in the wrong place. Just looking for a bit of advice..

My mum past away in Feb 2007 and have just found out that my Dad has just finished paying off a 6K barclaycard. I am outraged as I didnt know about this and he now informs me he was paying using her barclays staff pension! My mum had life insurance which payed off what was owed on the mortgage but there was nothing else in the estate. He couldn't really afford this and is now in debt trying to sort this out. I am a bit annoyed that they could do this and just wondered if anyone else has had similar experiences and if there is anything I can do.

spikescot2005

Best to start a new thread