equity and repossession question

styvvv

Hi All, following the recent death of my mother as an executor I have started to sort out the estate.
There is an equity release mortgage to pay off which whilst taking a significant chunk should leave a significant residue to share amongst beneficiaries, being four siblings (sons and daughters) of which I am one.
Just reading through the Key Facts about the lifetime mortgage which states that they have the right to repossess if someone else were to move in. A sister has been living at the mortgaged house for several years and the mortgage company has not been informed. Whilst she understands she has to move out and will not cause any problem holding up the sale of the house I'm worried that they could actually repossess, rather than us take responsibility for the sale in order to get the best price.
I'm not sure at which point the mortgage company will get to know of the death- is it for me to tell them? Nor am I sure how to proceed regarding my sister living here- keep quiet and hope they don't find out or come clean and tell them she is/has been living here?

Yorkshireman99

styvvv wrote: »

Hi All, following the recent death of my mother as an executor I have started to sort out the estate.
There is an equity release mortgage to pay off which whilst taking a significant chunk should leave a significant residue to share amongst beneficiaries, being four siblings (sons and daughters) of which I am one.
Just reading through the Key Facts about the lifetime mortgage which states that they have the right to repossess if someone else were to move in. A sister has been living at the mortgaged house for several years and the mortgage company has not been informed. Whilst she understands she has to move out and will not cause any problem holding up the sale of the house I'm worried that they could actually repossess, rather than us take responsibility for the sale in order to get the best price.
I'm not sure at which point the mortgage company will get to know of the death- is it for me to tell them? Nor am I sure how to proceed regarding my sister living here- keep quiet and hope they don't find out or come clean and tell them she is/has been living here?

As executor you need to be very careful. I believe you should tell the mortgage company of the death. You need probate before you can sell. the house. Are there any penalty clauses apart from the one you have stated?

styvvv

Thank you for your prompt reply, honesty is usually the best policy so I tend to agree.
There are no other clauses that are relevant that I can see at this point other than we have 18 months to make the sale before they can repossess. I have the latest statement and were looking at around 50% going to pay them off, I'm guessing at this point at the value of the property.

Keep_pedalling

The are unlikely to find out about the sister and there is no need for you to inform them that she has been living there.

You do need to inform them of the death and that they will be repaid on the sale of the house. As the equity release will be racking up interest is is important that the sister move out in the shortest time possible to allow you to sell as quickly as possible.

Although you cannot sell until probate has been achieved you can start to market it before then.

Yorkshireman99

styvvv wrote: »

Thank you for your prompt reply, honesty is usually the best policy so I tend to agree.
There are no other clauses that are relevant that I can see at this point other than we have 18 months to make the sale before they can repossess. I have the latest statement and were looking at around 50% going to pay them off, I'm guessing at this point at the value of the property.

You do need to make sure that the house is still insured. Your sister should be paying the council tax and a reasonable amount for the rent.