75 year old sold 25 year mortgage

jamesd

all, do try to remember that there's a wife involved. She may have been left in a very difficult situation, facing losing both her husband and her home in close proximity, while also discovering large debts that she didn't know about.

toddle2u, sorry to hear about the very tough situation.

Cohort life expectancy for 75 year old males in 2003 was 11.2 years, at which point about half of men are expected to have died. There's nothing wrong in planning to die with debts, though, it's a legitimate financial choice that people can and do make. Taking out a mortgage and planning to repay from sale of the property, perhaps through downsizing, is also a legitimate choice, much more so back in 2003 than now. Hopefully his assets will be sufficient to clear the debts so the creditors won't suffer.

It appears that his wife has survived him. No requirement to buy life assurance but it would have been more helpful for her if he'd chosen to buy some. Though maybe his financial situation didn't make the costs of doing so possible.

The type of ownership of the property - whether they are joint tenants or tenants in common - may be important here and you should be sure that this is considered.

Given the presence of the wife it seems that he might usefully have considered bankruptcy as an option back in 2003. That may have left her in a better situation now, depending on how the house was handled as part of the bankruptcy proceedings. But I can understand why he might have been reluctant to take this route.

From the posts I've seen here, GE Money seems not to be inclined to be more helpful than strictly required by law, so my guess is that they will rapidly seek possession of the property with a view to selling it to recover their money. Any excess resulting from the sale would be part of the assets of the estate.

Your thought that planning a mortgage to end after state pension age or retirement discounts the substantial increase in income that people may get once they start to receive the state pensions. That's likely to be an extra £7,000 per year that they didn't have prior to commencement of those pensions. For someone who stops working at that age it may be a decrease from their previous working income, but for those who retired earlier it can be that substantial increase, as it is on my own disaster (forced retirement due to ill health) planning. Forcing a mortgage to end just before a substantial increase in income that could be used to clear it would be poor financial planning for such individuals. Not applicable here where the mortgage was taken out after state retirement age and presumably based on being affordable with ongoing income.

I'm sorry to join the chorus here at a tough time, but the person accountable for this was him, who made the financial planning choices involved. I know it's not what you want to read but we aren't here to only deliver good news, sometimes, even in tough situations like this, the news is bad and this is one of those times.

RecoveringAlcoholic

To build up debts of £175,000 involves some serious spending.
An annual World Cruise?


.

toddle2u

Thank you for the more reasoned responses and advice it is appreciated. For those just psasing moral Judgement please don't bother posting as you are not contrubuting anything to the thread.

As with most things like this you do not get the full picture at first. Having now spoken to the (distruaght) widow at length last night I was able to ascertain the following further information;

Yes she realises that the debt needs to come out of the estate and needs to be paid back. Even though the property was in the husbands sole name she cannot understand how he was able to or adviced to get this mortgage as it turns out there were further substantal debts that were not paid off. There was a further £110k in loans and credit cards and a further £30k secured loan from Central Trust. There would never have been enough equity in the property to pay the £175k back or these other debts. All these had been accumulated prior to the mortgage being taken out. GE Money are now putting her under severe pressure to pay back the mortgage and she will be left homeless. There were no 'world cruises' or fancy holidays and she has no idea where the money was spent.

Ultimately it looks like se is going to have to sell the property and pay off the secured creditors from the estate and move into rented accommadation.

inmypocketnottheirs

Hmmmm, even if the property was in his sole name, the surviving wife will still own half of the beneficial interest. How that will be calculated with such tremendous debts (we are lookint at combined figures of well in excess of 1/4 million pounds from my understanding) will be an onerous task.

However, all said and done, I don't think that the courts are likely to award possession to GE whilst the widow survives.

GRM

Wouldn't the wife have had to sign the mortgage application in 2003? I thought all occupiers over the age of 18 had to give their consent to a new mortgage.

Thrugelmir

toddle2u wrote: »

For those just psasing moral Judgement please don't bother posting as you are not contrubuting anything to the thread.

Don't confuse moral judgement with personal responsibility. Which ultimately we all have as individuals. Everyone makes their own choices on how they manage personal finances.

Maybe your time would be better spent investigating and understanding where the money went.

dunstonh

e she cannot understand how he was able to or adviced to get this mortgage as it turns out there were further substantal debts that were not paid off. There was a further £110k in loans and credit cards and a further £30k secured loan from Central Trust. There would never have been enough equity in the property to pay the £175k back or these other debts.

You have answered the question yourself. There was not enough equity to cover the other loans and debts so they could not be included.

GE Money are now putting her under severe pressure to pay back the mortgage and she will be left homeless.

If it wasn't GE Money then it would be the executor of the estate (who should be putting the property up for sale, if not done so already).

Ultimately it looks like se is going to have to sell the property and pay off the secured creditors from the estate and move into rented accommadation.

If the executor of the estate clears the secured debts first then, any joint debts, then any unpaid unsecured debts cannot be passed to her. Although some of the "joint" assets could be seized to pay for them.

There were no 'world cruises' or fancy holidays and she has no idea where the money was spent.

Given the scale of the borrowing, that would be surprising. She needs to find out.

For those just psasing moral Judgement please don't bother posting as you are not contrubuting anything to the thread.

Look at your first post again. It looks like someone trying to pass the buck. Your later posts back that up as well. What do you expect?

Trollfever

We now have total debts of £315k but are still waiting to find out where it has been spent.

Thrugelmir

Trollfever wrote: »

We now have total debts of £315k but are still waiting to find out where it has been spent.

Does it matter though? As you can't take the money with you.

To fund this of level of debt , there must be a significant pension income so maybe its not all doom and gloom on the widows part.

Biggest shock must be to those banking on an inheritance at a later point in time.

jamesd

His estate is liable for debts in his own name and there may be a shortfall, leaving some only partially paid or unpaid. The widow wouldn't be liable for all debts, only joint ones and those in her own name, so it might be possible for her to buy the property from the estate at a value agreed by the secured creditors. depends how high her income and personal assets are.