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Advice Needed - Mum passed and mortgage and debt advice needed
Angeleyes1
Posts: 14 Forumite
Hi everyone,
Just after a bit of advice where possible. Unfortunately, our mum passed away just before Christmas after a very short struggle with Cancer at the age of 49. She was an amazing woman and I’m extremely proud to have been able to call her my mum.
We haven’t really had time to grieve (denial probably), if we’re not organizing the funeral, then it’s bills and trying to organize her home.
I’m hoping that someone may be able to help in regards to organizing my mum’s debts and mortgage, as I keep getting conflicting information so hopefully someone out there may be able to help, given that I’ve never been in this position before.
Luckily, we managed to sort out a will (exactly a week before her passing), in which she signed all that she had over to myself and my little sister. This included my mum’s mortgage in which she still owes on. The problem is my mum had remortgaged and was the sole mortgagee and given that my mum didn’t have any life insurance (cancelled exactly a year ago) or pension to clear the debt, we would like to take on the mortgage. It’s with the Bank of Scotland.
The mortgage had accrued quite a bit of arrears (£11k – £14k) over the years and prior to Nov ’12 they’d allowed my mum a mortgage holiday under the circumstances. However, as I’ve been caring for my mum for the last few months I’m not in work but now looking, but I do have some savings that I could use to make the payments. The mortgage repayments are £900 approx a month so I’m thinking of asking if we could pay an interest only rate for a period of time until I’m back in employment.
Approximately, the house is worth about £130k and my mum owed £110k but it’s a good investment and me and my sister are looking to rent it out to students as it’s in a perfect area and we’ve had people enquire about it already.
Also, my mum had several debts which she owed on outside of the mortgage, would I be able to enquire about PPI on her behalf and if so, how would I go about this? Mum did start making enquiries but unfortunately time wasn’t on her side.
Thanks for taking the time to read my post.
In love and light
:A Me x
Just after a bit of advice where possible. Unfortunately, our mum passed away just before Christmas after a very short struggle with Cancer at the age of 49. She was an amazing woman and I’m extremely proud to have been able to call her my mum.
We haven’t really had time to grieve (denial probably), if we’re not organizing the funeral, then it’s bills and trying to organize her home.
I’m hoping that someone may be able to help in regards to organizing my mum’s debts and mortgage, as I keep getting conflicting information so hopefully someone out there may be able to help, given that I’ve never been in this position before.
Luckily, we managed to sort out a will (exactly a week before her passing), in which she signed all that she had over to myself and my little sister. This included my mum’s mortgage in which she still owes on. The problem is my mum had remortgaged and was the sole mortgagee and given that my mum didn’t have any life insurance (cancelled exactly a year ago) or pension to clear the debt, we would like to take on the mortgage. It’s with the Bank of Scotland.
The mortgage had accrued quite a bit of arrears (£11k – £14k) over the years and prior to Nov ’12 they’d allowed my mum a mortgage holiday under the circumstances. However, as I’ve been caring for my mum for the last few months I’m not in work but now looking, but I do have some savings that I could use to make the payments. The mortgage repayments are £900 approx a month so I’m thinking of asking if we could pay an interest only rate for a period of time until I’m back in employment.
Approximately, the house is worth about £130k and my mum owed £110k but it’s a good investment and me and my sister are looking to rent it out to students as it’s in a perfect area and we’ve had people enquire about it already.
Also, my mum had several debts which she owed on outside of the mortgage, would I be able to enquire about PPI on her behalf and if so, how would I go about this? Mum did start making enquiries but unfortunately time wasn’t on her side.
Thanks for taking the time to read my post.
In love and light
:A Me x
0
Comments
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Sit tight and pay nothing from your own money towards the house for the time being - until you understand the legalities. Don't be hassled into dealing with any demands for money, take your time to grieve.
Legally, all your mother's assets and debts remain hers until the executors of the will have completed dealing with the estate. If you are an executor be very clear about not entangling the estate with your finances.You might as well ask the Wizard of Oz to give you a big number as pay a Credit Referencing Agency for a so-called 'credit-score'0 -
how much are the debts?
With arrears on the mortgage you may have an insolvent estate.
Any other assets beyond the house?
as above be very carefull and get a full picture before doing anything beyond the funeral.
Who are the executors?0 -
as I keep getting conflicting information
can you sumerize what your are being told so people can filter out the obvious bad from the possible good.0 -
Thankyou for your replies.
I just don't want to sit back and get ourselves in a worse position but it that's the best thing to do then so be it. Her debts are more than the equity she has in her house so there is no point selling the property (more than £35k).
Outside of the property mum has a business but not enough within that to warrant calling it an asset considering the state of the market at the moment.
The executors are myself, sister and my nan.
The conflicting advice that I've received is to contact the bank directly and formulate a plan of action with them rather than keep them in the direct and wait for probate. Also, in terms of mums debts should I contact them directly and advise them of the change of circumstances so it can be written off? I've also been made aware that I can look into claiming on behalf of my mum regarding PPI and yet when I've looked into this further this doesn't appear to be the case?
Very confused but conscious that there is so much to do.
Thanks once again.
I hope this helps.
Me0 -
I am sorry for your loss, this must be a very confusing and upsetting time.
Was the house and mortgage in your mum's name only? If so, then it remains her responsibility (or rather her estate's responsibility). If there is not enough money, then the funeral costs get paid, the house gets sold and the proceeds go to pay the mortgage off (or as much as possible) and if there is nothing left, then the estate is insolvent and no-one else gets paid.
You don't inherit anything until the debts have been paid off, and if there is not enough in the estate to pay the debts, you don't inherit the house, no matter what the will says, as the beneficiaries only inherit after all debts have been cleared.
The debts are NOT your responsibility.
The mortgage is not your responsibility.
Even if the will says that you will take over the mortgage, that is not possible as you cannot inherit a mortgage (you can take out a new mortgage in your own name to pay off the old mortgage, but you would have to meet the normal income requirements, and if there are som many debts, why would you want to do this?)
You need to notify the lender of the situation, as you will need to get probate in order to sell the house. If they are difficult with you, tell them to repossess. If there is no equity in the house, and no money in the estate, it won't make any difference to you.I'm a retired employment solicitor. Hopefully some of my comments might be useful, but they are only my opinion and not intended as legal advice.0 -
I'm so sorry for your sad situation. I've lost both parents over the last 3 years but both at reasonably ripe old ages; still miss them. Must be very difficult at such a young age.Angeleyes1 wrote: »Luckily, we managed to sort out a will (exactly a week before her passing), in which she signed all that she had over to myself and my little sister. This included my mum’s mortgage in which she still owes on. The problem is my mum had remortgaged and was the sole mortgagee and given that my mum didn’t have any life insurance (cancelled exactly a year ago) or pension to clear the debt, we would like to take on the mortgage. It’s with the Bank of Scotland.
:A Me x
I wouldn't have thought that a mortgage can be left in a will. The fact is that the Bank of Scotland own (most of) the property, not your mother's estate. Whether the bank would grant you or your sister a mortgage will depend entirely on your own financial situation.
You'll have to inform the mortgage provider of her death, and take it from there.
I'd also be slightly worried about a will that 'bequeathed' a mortgage in this way. It rather implies that a solicitor wasn't invovled ... which might mean some other aspects might be out of order too ....
Or maybe I'm mis-reading the situation?0 -
Her debts are more than the equity she has in her house so there is no point selling the property (more than £35k).
The estate is insovent you need to be very carefull.
You can't just take over the mortgage and keep the house if there is equity , you would need to buy the house out of the estate at market value.0 -
Angeleyes1 wrote: »
- Her debts are more than the equity she has in her house so there is no point selling the property (more than £35k).
- The executors are myself, sister and my nan.
- The conflicting advice that I've received is to contact the bank directly and formulate a plan of action with them rather than keep them in the direct and wait for probate. Also, in terms of mums debts should I contact them directly and advise them of the change of circumstances so it can be written off? I've also been made aware that I can look into claiming on behalf of my mum regarding PPI and yet when I've looked into this further this doesn't appear to be the case?
2 As executors, you are only there to do a job. You don't have to do it - and looking at the situation, it would be wise to think long and hard before taking it on. You should not let your mother's finances get muddled with your own in any shape or form. In particular do not pay anything whatsoever from your own money to the mortgage and don't pay anything from your mother's accounts either until you understand what you are doing
3 If any conflicting advice comes form any bank or institution to which your mother owed money, then ignore it. They will try to get you entangled and paying off your mother's debts. Don't let them mug you. None of you are obliged to be executors.
Just do nothing, don't let anyone twist your arm into anything beyond sorting the funeral.You might as well ask the Wizard of Oz to give you a big number as pay a Credit Referencing Agency for a so-called 'credit-score'0 -
Hi
sorry for your loss. Everything must be really raw right now.
Did you live with your Mum? I had assumed so, but then you go on to talk about letting the house was slightly confused.
as others have said though, you cannot just take on the mortgage., but even if there were a minimal bit of equity, then becoming a landlord overnight is a big step for you too.
take it easy, especially over next few days and weeks, and dont tackle anything until you are ready.
as far as the bank goes, i personally believe you would tell them, but not to formulate a plan as such. Just inform them of the next steps (i.e. sale?)0 -
(Not sure why this won't un-bold - sorry!)
I found the 'Which' Book: Guide to Wills and Probate very helpful when I was an Executor.
The government's online sources of help are here:
https://www.gov.uk/browse/births-deaths-marriages/death
And the following is a useful checklist
What to do when someone dies - Gov.uk
www.direct.gov.uk/prod_consum_dg/groups/.../dg_170740.pdf
Hope these help.0
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