Death when in Debt - Help/Advice needed, please.

Temporary

Hi there,

I just wanted some advice really - I have been reading up but want to check that I have things right as it's quite a complex issue, and we've never had to deal with anything like this before.

The Situation:
My mother-in-law was found dead yesterday - she had taken her own life. We are awaiting results from the coroner so unable to register the death yet.

As the eldest daughter, my wife took away the contents of the safe to go through in order to look for a will/reference to a will. Instead, we found debts (many of which were with debt collection agencies) of around 40k on top of the mortgage of around 70k. It is unlikely that the value of the house will cover this amount, but we haven't had anything professionally valued yet.

We have found no will but have contacted a solicitor who's card we found to see if she did have one with them (as one has been mentioned in the past)

The Questions
1. Assuming that there is a will, someone will be named as executor - with the above situation, would it be advisable/possible to appoint a professional to act as executor to avoid any potential problems with creditors?

2. Can funeral costs be paid out the estate or would everything have to go towards debt repayments first (have seen conflicting information on this)? It would be a modest funeral, nothing extravagant.

3. We found details of pension plans - one including a death in service amount. We have contacted her work for more information on this, but in general am I right in thinking that if there is no nominated recipient then this money will go to the estate and therefore go towards repayments: but if there ARE any nominated beneficiaries then the money goes to them and will bypass the estate? (Wife has two younger siblings both under 25 and is hoping that they have been provided for)

Thanks in advance for any/all advice or help that you can give.

RAS

Really sorry to hear about the situation that you are all facing.

Funeral costs are the priority for any estate; ask the funeral director to send the bill directly to the bank if there are any accounts in which there is money (or likely to be if she is still to be paid part of a month's salary for example).

Your assesment of the situation regarding death in service payments and nominees is roughly right. Just that the pension providers have the option of making payments to nominees (as legally required) not are obliged to make them as nominated. Warn all three parties that if anyone of them starts to object to the nomination most schemes will solve the issue by paying to the estate instead.

Is there any life insurance to cover the mortgage?

You may have noted that people often suggest that if the estate is insolvent, you do not execute or administer the estate and let the creditors sort it out between them.

Until you have some idea whether the death in service grant goes to nominees, whether there is any life insurance in place and whether the house value covers the debts, it would be wise not to intermeddle.

Temporary

Thank you RAS.

The only current account that we have found is overdrawn by around 2k - am I to assume then that funeral costs would eventually come out of the estate (e.g. from sale of house or whatever)? Or might we be required to pay up front as there is no guarantee?

Thanks for the advice about the Death in Service payment. We should hopefully be setting up a meeting with the HR department of his work to find out a bit more about it.

Do you know if it is likely to be affected by the fact that it is suicide?

We haven't found any life insurance information as yet, so not sure if that exists or not.

Would it be advisable to pay for a valuation sooner rather than later out of our own pocket? Or can that be billed to the estate too? Does the solicitor take care of that?

Apologies for all the questions.
Many thanks for your reply.

RAS

Re valuation just ask two or three local estate agents to come round and give a valuation for sale?

Alternatively are any other house in the same road/area for sale ritght now? What are they on the market for?

Once you have the death certificate, go into the bank and ask for a list of the DDs or any that have recently bounced. You may find a life insurance policy there?

Temporary

Ah yes that's a good point - we sorted out all the bank statements and returned payment letter this morning, I will have a scour through them to see if I can find anything that looks like it could be an insurance company.

Oh and yes, I can have a look on Zoopla or rightmove or whatever and if there's not much on there we can speak to an estate agent.
Thank you. Funny how little things don't occur to you when you have so much to think about.

Thanks again

RAS

Given the situation, you may all be feeling a bit numb at the moment (been there and got the T-shirt and do not want to do it again).

There is no such thing as a stupid question; the stupidity is usually not asking. Take your time and if you want more info people here will try and help as best as they can.

Temporary

Thanks a lot RAS.

getmore4less

google

intermeddling

insolvent estates

also search this board, there are examples and links to useful info