Credit card debt after death

YorkshirePoolie

Hi all,
Just looking for a bit of advice.
My Mum died recently and I am trying to sort out all of the paperwork for my Dad.
My Mum had a loan and credit card when she died. We have found out that the loan had insurance- so that is covered. However, the credit card hasn't got insurance, and the credit card company is asking for details of who is dealing with the estate.
I have no idea! I have been informing everyone of her death, and sending the relevant certificates, but I have no idea what will be in her estate:-(
I am wondering whether Dad is liable to pay this? From what I have read, the house transfers to him and so is now his estate.
Dad will get a lump sum payout from Mum's work, will this sum be classed as her estate? If so, I am guessing that he will have to pay the credit card out of this?
Thanks for your help, sorry if my question isn't clear.

dazza.mk

YorkshirePoolie wrote: »

I am wondering whether Dad is liable to pay this? From what I have read, the house transfers to him and so is now his estate.
Dad will get a lump sum payout from Mum's work, will this sum be classed as her estate? If so, I am guessing that he will have to pay the credit card out of this?
Thanks for your help, sorry if my question isn't clear.

Firstly sorry for your loss, to answer your queries:

Your Dad isn't liable, the liability is only on your Mum's estate in the event that doesn't have the money to pay the credit card bill the card company must write it off (although they may require details from the executor)
Re: The payment from 'Mum's work' if the life assurance is written in trust it should pass to the named beneficiaries and won't be part of her estate, if there is no trust then potentially it may be paid into her estate.
In terms of the house, as long as they held a joint tenancy (rather than tenants in common) on the house it should pass directly to your Dad with no issues.

Clive_Woody

Sorry to hear of your loss.

The executor of your mum's will should handle this, but yes I do believe that the payout from her work will be classed as part of her estate and would be used to pay this debt. Funeral expenses take priority from a deceased person's estate then other debts are payable from any remaining funds.

Make sure you contact the credit card company to inform them that you mum has died and ask that they freeze interest so that the debt does not continue to grow while her estate is sorted out.

(I am not an expert on this so somebody with more experience may be along soon).

YorkshirePoolie

Thank you dazza.mk and Clive Woody.

Unfortunately she didn't have a will, she looked at getting one, but the Solicitor said she had no worries as she was married.

As far as I know there is no executor,my limited understanding was because there was no will that my Dad would be the administrator?

The payment from her work had Dad down as the beneficiary, so hopefully that will be classed as his estate.

I have informed the credit card company, and send the death certificate. Thanks.

antrobus

dazza.mk wrote: »

..Your Dad isn't liable, the liability is only on your Mum's estate in the event that doesn't have the money to pay the credit card bill the card company must write it off (although they may require details from the executor)..

Unlikely that the credit card company will write it off. There is a house.

YorkshirePoolie wrote: »

...I am wondering whether Dad is liable to pay this? From what I have read, the house transfers to him and so is now his estate. .....

Practically speaking, because your mother had a half share in the house, your dad will end up being liable to pay it, if all else fails.

YorkshirePoolie wrote: »

..the credit card company is asking for details of who is dealing with the estate. I have no idea!....

The answer might be nobody. If your mother's share of the house passes automatically to your father, and the death-in-service benefit gets paid direct to your father as the nominated beneficiary, and your mother didn't own any other significant assets, then there may be no need to go through probate. The estate can be dealt with 'informally'. So you just need to tell the credit card company that, and arrange to pay off the debt once your father has the money to do so.

Battleaxe44

When my late husband died, his credit card debt died with him. I sent the relevant paper work and the account was written off.

The Work insurance passed directly to me as did the house. He had a Will but as his Estate was below the limit it was never probated and dealt with informally.

The Shares he had were passed over to me. I had no problem selling them. it was done and dusted in six months.

The joint loans were another matter and involved mis-sold PPI. and another matter but I wont go into this here.

antrobus

Battleaxe44 wrote: »

When my late husband died, his credit card debt died with him. I sent the relevant paper work and the account was written off.

The Work insurance passed directly to me as did the house. He had a Will but as his Estate was below the limit it was never probated and dealt with informally.

The Shares he had were passed over to me. I had no problem selling them. it was done and dusted in six months.

The joint loans were another matter and involved mis-sold PPI. and another matter but I wont go into this here.

You committed fraud, since clearly there were assets in the estate (the shares) that should have been used to settle the debt.

I wouldn't advise anybody to commit fraud, even if it's easy to get away with it.:)

YorkshirePoolie

Thank you all, I will call the credit card company and have a chat with them and see where we stand.

Thanks for all of the advice. :-)

pjread

antrobus wrote: »

Unlikely that the credit card company will write it off. There is a house.



Practically speaking, because your mother had a half share in the house, your dad will end up being liable to pay it, if all else fails.

Actually, that's irrelevant as the house is never part of the estate so long as it was owned as joint tenants. The survivor continues to own the house, there is no real transfer as such.

If there are insufficient assets in the estate, then they are out of luck I'm afraid. Of course, if there *are* sufficient assets (cash, shares, etc) in the estate, then it must be paid from the estate by the executor or administrator.

antrobus

pjread wrote: »

Actually, that's irrelevant as the house is never part of the estate so long as it was owned as joint tenants. The survivor continues to own the house, there is no real transfer as such.
...

It's not irrelevant, because a creditor can apply for an Insolvency Administration Order and force the surviving owner to pay the value of the deceased's equity into the estate. (s421a Insolvency Act 1986, as amended by the Insolvency Act 2000)

National Debtline says "Although this is a rare procedure, it makes it very important that a surviving owner negotiates with any creditors to make arrangements to pay the debts. It may prevent the insolvency administration procedure being used by creditors".

Obviously I can't say whether any particular creditor would follow that procedure (the sum involved might not make it worth their while) only that they can. Therefore I would follow the advice given by National Debtline.

dzug1

YorkshirePoolie wrote: »

As far as I know there is no executor,my limited understanding was because there was no will that my Dad would be the administrator?

Correct.

If he doesn't want to do it he can renounce and you would be next in line.

Or he could do it nominally and you could do all the work, preparing letters etc for him to sign