death and mortgages

motor_bike

hi,

i took over my dads company after he died, change of director etc to get it into my name. my mum is the other director. now, my dad secured a mortgage against their house to purchace the company (only a small amount and they had full equaty in the house, i.e no mortgage) . i have not let the lender know about my dads death and have not changed the mortgage into my name as its only got 10 payments left, and i have only just relized that i was paying it :eek:. should i tell the lender and will it cost anything also would the mortgage have stopped as a result of dads death etc. dont want to upset the apple cart if you know what i mean . would i be right to assume there might some morgage payment protection in place that would cover this ?

dimbo61

You need to check this yourself by looking through your Dad,s papers or speaking to mum or his solicitor.
Did your Dad have life cover to repay the mortgage? Or mortgage payment protection to pay out if he was ILL?
The debt is still on the property and will have to be repaid at some time!
If you stop paying now I guess the mortgage company will add lots of charges+costs ( letters, debt team, solicitors etc)

dimbo61

" ASSUME " nothing and speak to the right people ie mum and the solicitor, family accountant ?

motor_bike

dimbo61 wrote: »

You need to check this yourself by looking through your Dad,s papers or speaking to mum or his solicitor.
Did your Dad have life cover to repay the mortgage? Or mortgage payment protection to pay out if he was ILL?
The debt is still on the property and will have to be repaid at some time!
If you stop paying now I guess the mortgage company will add lots of charges+costs ( letters, debt team, solicitors etc)

i have been paying as normal for the last 2 years , not missed a payment.

we are currently looking through his paperwork and belongings so more info will turn up. he was ill when he took the mortgage out as he was a diabetic and had suffered a heart attack a few years earlier so this may of affected the terms and conditions of the mortgage.

after paying off my one and only mortgage 2 years early i now find myself paying one off for a business that i inherited and will also have to now buy my girfreind out after a split . hence the questions as i will pay this one off with savings if there was no life cover on it

holly_hobby

Strictly speaking what you have done is against the law - in that the mortgagor (Dad) has deceased, but you have falsely acted as him in maintaining the mortgage under his name for a period of 2 yrs, during that time neither advising the lender of Dads death (which his estate had a legal responsibility to do), nor seeking their permission for a transfer of equity - as such the debt remains Dads (now his estate) not yours as debts are not transferrable to 3rd parties.

Can I ask how probate was dealt with, and why a debt of Dads was not included and dealth with, in the administration of his estate ? Or is probate still un-completed ?

Even if in joint names with Mum, as it is mortgaged, she had a duty to advise the mortgagee of Dads death, and either repay the mge from his estate proceed, see if its affordable on her sole income, or if her income is insufficient, negotiate a way forward via possibly adding you to the mge. (albeit I'am aware you are paying the mge, whether the mortgagee deems your combined income/status sufficient is another thing unfortunately).

Of course you could leave sleeping dogs lie, and just cross the disclosure bridge if they require his signature to anything between now and redemption (presume this is a repayment mge).

Bit of a pickle .... but strictly speaking it will be within the mge t&cs that such disclosure should be made ..... regardless of whether the mge is being maintained or not.

Holly

Thrugelmir

Who are the shareholders in your late fathers Company?

How did you effect transfer of the share ownership?

dimbo61

This is complex so you really need to speak to the company accountant and your solicitor.
Sorry about your loss and hope you can get things sorted

motor_bike

sory for the delay,

i think as its been such a long time and there are only 8 payments left i am going to let sleeping dogs lie.