Dealing with mum's will - no cash only property

LizW

I am dealing with my mum's will as there is no cash to pay the solicitors who were named as executors. They are preparing a deed of renunciation and I have the PA1 form to complete.


The will stipulates that after costs £5,000 should be paid to each my niece and nephew (I have no children) and the balance of the estate is split equally between myself and my sister.


There is no cash - the only asset is the property my mum and my sister lived in (she is 55 and was my mum's carer).


The only was to pay my niece and nephew their inheritance is for the property to be sold and therefore my sister to lose her home. I do not intend to claim my share of the estate to enable my sister to keep her home so presume I would just complete a TR1 form after probate is obtained to transfer the property solely into my sister's name but how do I deal with the inheritance due to my niece and nephew?

elsien

Can your sister now work and get a small loan or mortgage to cover the money for nieces and nephews?
She may find something in a caring role, given her experience in looking after your mum.

BobQ

You should get the property valued and settle her funeral costs first.

What does your sister want to happen? Or your neice and nephew?

If your sister or you have some savings you could settle the bequest to neice and nephew and any other debts and then register the house in your joint names. This would mean the decision to sell or not is between your sister and you alone.

Alternatively is it possible you could sell the house and there is enough money for your sister to buy a smaller home from her share?

Ultimately as the executor if neice and nephew want their money they are entitled to expect you to sell the house and pay the money to them.

Do neice and nephew need the money? Would they be prepared to wait for a year or so, so that you and your sister can sort out an alternative way of paying them? In any case some delay would be reasonable while you apply for probate.

One long term effect of you keeping a share of the house but not living there is you may have to pay capital gains tax on your share when it is sold.

nom_de_plume

LizW wrote: »

I do not intend to claim my share of the estate to enable my sister to keep her home so presume I would just complete a TR1 form after probate is obtained to transfer the property solely into my sister's name but how do I deal with the inheritance due to my niece and nephew?

Am I reading this correct in that you wish your sister to have your share of the property absolutely?

If so, and if the niece and nephew are willing to forgo their inheritance you will need to look at a deed of variation. I presume the niece and nephew are over 18.

How will you deal with other debts such as the funeral cost?

If your sister needs to raise some money and still keep the property then a small mortgage or loan, as mentioned earlier, is probably the best option.

getmore4less

Are they the sisters kids?
How old are they?

IF over 18 how flexible are they on waiting.

If the preference is to try and keep the house then for £10k it is not worth selling and buying something cheaper the costs will be a big chunk of £10k looking for other ways to raise the funds would be more cost effective.

Depending on the value and your estate a deed of variation may be a waste of money and a gift will do the job.

theoretica

LizW wrote: »

The will stipulates that after costs £5,000 should be paid to each my niece and nephew (I have no children) and the balance of the estate is split equally between myself and my sister.


There is no cash - the only asset is the property my mum and my sister lived in (she is 55 and was my mum's carer).


The only was to pay my niece and nephew their inheritance is for the property to be sold and therefore my sister to lose her home. I do not intend to claim my share of the estate to enable my sister to keep her home so presume I would just complete a TR1 form after probate is obtained to transfer the property solely into my sister's name but how do I deal with the inheritance due to my niece and nephew?

There are more options than that - you can let your sister live in a property you own half of. Though you would be wise to have a written agreement about maintenance etc. Giving your half away to her should be carefully thought out as it could have an impact on any benefits either of you get now and future care needs.

Are the niece and nephew your sister's children? I assume they are not living at home and over 18. Only they can decide if they are willing to give their inheritance to their mother. If you are giving half the house to her they may inherit more later and be happy to. Otherwise you would be looking at a loan or loans - £5k each if you keep your half of the house, or £10k from your sister if she has it all. Taking in a lodger might be a way of paying off such a loan?

G6JNS

LizW wrote: »

I am dealing with my mum's will as there is no cash to pay the solicitors who were named as executors. They are preparing a deed of renunciation and I have the PA1 form to complete.


The will stipulates that after costs £5,000 should be paid to each my niece and nephew (I have no children) and the balance of the estate is split equally between myself and my sister.


There is no cash - the only asset is the property my mum and my sister lived in (she is 55 and was my mum's carer).


The only was to pay my niece and nephew their inheritance is for the property to be sold and therefore my sister to lose her home. I do not intend to claim my share of the estate to enable my sister to keep her home so presume I would just complete a TR1 form after probate is obtained to transfer the property solely into my sister's name but how do I deal with the inheritance due to my niece and nephew?

This may sound harsh but as executor you are legally obliged to distribute the estate according to law. If that requires the house to be sold then it has to be done. Unless the two beneficiaries agree to forgo their money then the other alternative is for you to pay them. You cannot legally transfer the house ownership until the rest of the estate is dealt with.

LizW

Thanks everyone - yes niece and nephew are my sisters children and are in their 20's and no longer live at home. They don't actually know they have this inheritance and in fact my niece is the reason that there is no cash in my mum's estate as she was continually borrowing money so I feel any inheritance she does receive should have these debts deducted.
My sister has previously been bankrupt so will be unable to raise funds to pay their inheritance so I guess they will just have to wait until some time in the future.
If I kept joint ownership of the house with my sister living in the house would it be fair to say I would not be liable for maintenance costs in lieu of not receiving say 'rent' for my sister living in my 'share' of the house? Obviously I presume this would have to be by a written agreement.
Then I guess if my sister decided at some point in the future to sell the house I could give her my half of the sales proceeds to wards another house - but would there be tax implications of doing this?

p00hsticks

LizW wrote: »

so I guess they will just have to wait until some time in the future.

You can't just say this- if you are talking over the executorship then you have a legal obligation to ensure that your mothers wishes as specified in the will are met in a timely fashion.

Mojisola

LizW wrote: »

The will stipulates that after costs £5,000 should be paid to each my niece and nephew (I have no children) and the balance of the estate is split equally between myself and my sister.

You have a legal duty - you have to pay out the money to the grandchildren before you and your sister share what's left.

You cannot transfer the house into your names and make the grandchildren wait until some unspecified time in the future for their inheritance.

Mojisola

LizW wrote: »

my niece is the reason that there is no cash in my mum's estate as she was continually borrowing money so I feel any inheritance she does receive should have these debts deducted.

Unless you have clear evidence that this money was loaned rather than gifted, you cannot deduct money from her legacy.