Loan given with no way to repay

anneb1

Okay, where to start.....

Is it right that a loan for £25k can be given to someone who has no way to repay it?

My brother took out a loan in his wifes name, she never visited the bank, but he bought home the forms for her to sign. They have 2 small children so she doesn't work and has no income of her own.

The loan was being repaid from my brothers income until he unfortunately passed away a couple of weeks ago. Even the lady from the bank was surprised that they had given a loan solely in her name if she had no income.

Is it right that they can do this? Don't spose there is anything that we can do? (she is in a bit of a mess as he had no life insurance against the mortgage either)

Thanks

mountainofdebt

I'm sorry to hear of your loss and the mess that your SIL now finds herself in.

I don't want to be the bear of potentially more bad news but was the loan secured against the property?

Does she know what happened to the £25K?

AMILLIONDOLLARS

Realy sorry to hear about your SIL and your loss.

How long ago was this loan taken out, has she got a copy of the agreement. very surprised that the bank did not ask for proof of earnings Does she have access to your brother's bank account/s financial paperwork. With regards to the mortgage, did they take out any endowments, I am very suprised that the mortgage company would approve a mortgage without some kind of proof that it would be paid off in the event of the death of one or either partner, the premium could have been included in the mortgage repayment.

Sorry not much help, hope everything works out in the end, this is a very sad situation.

AMD

anneb1

Thanks for your help!

Im not sure if the loan was secured or not. The loan was taken out about 8 months ago not sure what it was spent on (!)

We all find it strange that they didnt insist that the property was insured too, but after looking through everything it seems its not.

Thanks for coming back to me though, I didnt think there was much that we could do but it was worth an ask!

kal25

Sorry to hear about your loss Anneb1, your brothers paperwork needs to be sorted out, then perhaps you may find the agreement and see what the bank have to say. I was able to take a loan in my name even though I wasn't working but hubby was. However, that was for nowhere near £25k.

AMILLIONDOLLARS wrote:

I am very suprised that the mortgage company would approve a mortgage without some kind of proof that it would be paid off in the event of the death of one or either partner, the premium could have been included in the mortgage repayment

AMD

You would think so but when we went to change our mortgage recently, apparentley, we haven't had pp on our mortgage when we renewed with them 4 years ago:eek:
Needless to say we have it sorted now.:T

Goodluck anneb1 hope you are able to help SIL.