REPOST: remortgaging after retirement with no life insurace/assurance

evillil

hi there

I have a question (or really, a bunch of them) which is bugging me and hoping someone here may be able to shed light on a rather vague situation!

a bit of background:

I am a 33yr old woman and have been estranged from my father since the age of 17. I have a younger half sister with whom I have enjoyed a good relationship since tracking her down around 5 years ago. She maintained her relationship with our father.

During a visit last year, I learned, to my great surprise, that although my sister was designated executor of his will, I was included in it in some way.

At the end of March, my father died suddenly. Being as I was so thoroughly removed from his life, it fell to my sister to make arrangements and go through his paperwork etc. In the course of her search, she was unable to find any evidence of a will. Phoning goodness knows how many local solicitors, including the one who had dealt with his divorce from her mother, turned up nothing. What she did find, however, was that he had recently (within the last 2 years) remortgaged his flat to a very high LTV rate (something like a £146,000 loan, with the original value of the mortgage being £149,000 or similar). She also discovered something like £60,000 worth of credit card debt built up over the last 2 years, this despite the fact that he retired 2 years ago. She is currently applying for probate and as far as I am aware, has found no evidence of any life insurance/assurance.

Clearly, I am at an informational disadvantage as it were, as I didn't even know where he lived, let alone any of the details of his life; i also don't want to question my sister endlessly, not least because it seems like a terribly crass thing to do: to suddenly take an interest in my deceased father's financial affairs... I won't lie, it would be nice if something good came from someone who never provided for me either emotionally OR materially, but I don't expect my sister to feel the same way as I do. He was, after all, her dad and she loved him in a way that I couldn't. I have not gone beyond asking her how it's going/offering to help and have received polite but vague responses. She hasn't volunteered any information without me asking for it and as I said, I don't want to push her.

My question (the one which is bugging me) is that, based on the information I've been given, 'how did my father obtain such a large mortgage at his age, given that he was retired and possibly already had substantial credit card debt, without a life insurance/assurance policy in place?' I realise that I have very little to go on and am party to none of the details, but any way I look at it, it does not compute! It seems to me that, financially speaking, he was a bad bet. Under what circumstances could he remortgage, given his situation? Am I missing something?

I appreciate any light being shed on the situation

thanx

mountainofdebt

As far as I'm aware you don't need to have Life Insurance to have a mortgage - in fact I know of more than one person who decided not to take Life Insurance out due to their death-in-service benefit that they had with their employment.

I do agree though its odd that your father took out the mortgage and had the debt - has your sister indicated what the money was spent on?

evillil

No, I'm aware that Life Insurance isn't a prerequisite for getting a mortgage - I just can't figure out why anyone would lend him such a large sum of money, given his circumstances. The only time I heard any details about it was at his funeral 2 1/2 weeks ago, when she told me she didn't know any details about it as she was still waiting for the death certificate to be sent through. At the time, I wondered if maybe he'd remortgaged to pay off the credit cards, but again I run into the poor credit brick wall... Unless there was some kind of assurance that the debt would be repaid, what idiot would lend him the money?! I suppose the lender wins through repossession of the property?

I should say that in the course of my digging, it would appear that probate is unnecessary where assets amount to less than £5000. So, with a huge (relative to value) mortgage, £60k worth of credit card debt and a £4k overdraft, where is the value in his estate that's worth going to probate over?

Although it doesn't necessarily mean anything, I'm surprised he left such a mess, given that he was in the throes of contesting his own father's will having been left completely in the dark after his death, and told my sister at the time that his will was in order etc