Joint mortgage payments after death?

timborules

Hi All,

Assisting my Mum in dealing with my late father's estate - its still recent so still weighing up using a solicitor (one executor) as opposed to my Mum acting as executor.

My parents had a joint mortgage (deeds on house in both names) with direct debt payments for the mortgage coming from my mother's bank account.

In the process of probate (which I make the assumption we will enter), do the mortgage payments still need to be made, or are they frozen pending outcome of probate (which will inevitably mean my mother is responsible, I understand).

Reason I ask is that in the short term (i.e. 1-9 months) we need to ascertain how various bills will be met whilst my mother is without my father's income.

Any help gratefully received,

timborules.

NAR

Assuming he has no will, ie died intestate, well then she will have to keep up mortgage payments. If this causes financial distress in the sort term she should talk to the mortgage provider to make alternative arrangements.

John_Pierpoint

Can we assume that dad did not live north of Hadrian's wall ?
Mum is almost certainly jointly & severally liable for ALL the mortgage payments.
Did dad die intestate (ie no will).
What is available in the form of life insurance ? Not even a mortgage protection life insurance policy ?
What is the house worth ?
Is the house registered at the Land Registry?
What roughly is the rest of dad's estate worth?
Apart from the house, what does mum have in the way of wealth? How liquid is it? What does mum have in the way of annual income.
Are you living in the family home?
Any other children available to help?

[If it is any help I found myself in your situation when I was 21 - and all dad left that was "liquid" was impressive debts.]

timborules

Thanks both for your replies.

Dad had a mirror will with my Mum so everything is left to her.

Dad had life insurance for the value of the mortgage (minus what he believed he had as death in service benefit with his then employer when the policy was taken out in 2008 - we're trying to ascertain if that was his current employer and what the benefit actually is). This would no doubt pay off most/all of the outstanding mortgage in the fullness of time but my concern is for the short-medium term, for example August's monthly payment onwards.

Mortgage was £240k, interest only (no endowment or anything to pay off capital, long story) house hasn't been valued since 2008 when it was valued at approx £290k, though I suspect value roughly matches mortgage now. Life insurance is for £181k with the presumption/recall from my Mum that Dad's then death in service was the shortfall (£59k). Policy is in trust for my Mum, so I'm told doesn't need to await probate?

House registered at land registry.

No other real value in rest of estate, no savings/investments to speak of, just contents of house. Mum's annual income is very modest as an office administrator.

I live the other side of the country with my wife and two very small children - my brother is dependent upon my mother (and father) as is a university student living at home. My family can and will help, but the extent to which we can help is fairly limited given that Mum's income covers about 35% of the normal outgoings, Dad's covered the remaining 65% so its quite a bit gap. Of course, if there isn't a mortgage to pay (as Dad had made provision for), it's not too much of a problem.

John_Pierpoint

Very similar to my situation, only in my case I had a sister still at school doing her A levels and a menopausal mother "you kids just treat this place like a hotel".

Well it was a bit of a wake up call ! We all rallied round. With a bit of overtime I could bring in a whole £1,000 a year and mum brushed up on her wartime secretarial skills, sister managed to get her A levels, then did a year's course of secretarial skills, which stood her in good stead for casual earnings when at university [and in those halcyon days she qualified for a full grant].

The most important thing is to understand the life insurance situation.
All my dad had was a mortgage protection policy, ie a cheap life insurance that would normally die with nothing to show at the same time as he paid off the (fixed interest!) mortgage. [Obviously mum, as a stay at home mother, took no part in the mortgage and got a nasty shock, when she discovered she wasn't named on the house title documentation].

Do you have two policies, one for mortgage protection and one an investment for mortgage repayment with hopefully something left over for a retirement cruise? Are both pledged to the mortgagee ?

The trust business makes the money available ahead of probate (but in the case of my latest estate - my uncle - The Prudential aid pout immediately against the death certificate not the grant of probate). As mum appears to get everything, the concept of InHeritance Tax (IHT) should not be an issue, unless dad had "hidden" wealth (for example a trust fund in which he had a beneficial interest). The concept of putting the insurance policy into trust keeps it outside dad's estate. Something similar may apply to dad's pension fund(s) - so you need to understand mum's position relative to the pension funds.

There are many more quirks to the system but as I expect you have already realised my experience is somewhat out of date, so I will leave it for posters with more current advice to continue this thread.

[When my dad died the family home was worth £11,500; when mum died 8 years ago it sold for a number over 50 times greater.]

RAS

In addition to the death in service benefit, is mum entitled to any widow's pension from the work scheme?

Has she checked whether she can get any widow's or death benefits? See here http://www.adviceguide.org.uk/england/benefits_e/benefits_bereavement_ew/benefits_and_bereavement.htm

You may have not choice on usig the solicitor as executor but if the house is a joint assets, he may decide he could do withouth the fees (could be 3-4% of the value of the estate which would be a pain if there are no savings).

TBagpuss

As the mortgage is in joint names the payments are not automatically frozen, however if your mum is going to struggle then it is sensible to speak to the mortgage lender to see whether she can agree a payment holiday until the life insurance pays out.

It's also worth checking with the lender whether there is any mortgage payment insurance as this may have been taken out via the lender.

Condolences on your loss