Credit Cards, Estate and sleepless nights Help...

ca7csu

Hello -
Need some advice.
My father recently passed away, and I am now sorting through his 'affairs'
We have discovered a sizeable amount of debt owed to Amex, and two debt collection letters from Wescot and Cabot....


His estate was made up of £250 in the bank and a few quid in his pension account (literally a few quid)


the house was a former council house purchased 20 years ago, The names on the Land Registry were my Dad, Mother and myself.
Both parents have since passed away, I have had their names removed from the Land Registry - as I was joint owner.


Where do I stand with the debt?
His estate is zilch in comparison to what is owed..... Having a few sleepless nights :-(


Thanks

Casual_Bystander

Do you know if the 3 of you owned the house as tenants in common or joint tenants?

http://theprobatedepartment.co.uk/insolvent-estates/

Cas

Yorkshireman99

The debts are payable from the estate. If your father was joint owner of the house then that forms part of his estate.

Brighty

If tenants in common, his share of the house is part of his estate and debts will need to be paid, presumably from selling the house.

If joint tenants, then ownership passes straight to you, is not part of his estate. However it is then an insolvent estate and the creditor(s) have 5 years to make a claim to sever the joint tenancy and get their money from you

What happens if they try to do it but you've long since sold the property and spent the money??? I assume the debt becomes yours???

Brighty

Tuesday_Tenor

I would tend to assume the house must previously have been held as joint tenants.

If it had been tenants in common, then wouldn't the Land registry have required probate (x2) for both mother's share and then father's share to be transferred?

OP still needs to double-check this.

Also:

- Need to check with DWP that father wasn't paid any pension in advance. Anything paid that was for period after date of death will need to be returned.

- Has the funeral happened and been paid for? That would be the first call on the estate, so if you have paid for the funeral yourself you can claim whatever's there (£250, maybe minus pension to be repaid) as partial reimbursement for the funeral costs.

After that there's nothing left. See the link re insolvent estates in post #2. Basically, you write to everyone saying the estate is insolvent.

brewerdave

Brighty wrote: »

If tenants in common, his share of the house is part of his estate and debts will need to be paid, presumably from selling the house.

If joint tenants, then ownership passes straight to you, is not part of his estate. However it is then an insolvent estate and the creditor(s) have 5 years to make a claim to sever the joint tenancy and get their money from you

What happens if they try to do it but you've long since sold the property and spent the money??? I assume the debt becomes yours???

Brighty

Assuming joint tenants,can the creditors force a sale for unsecured third party debt??

Yorkshireman99

brewerdave wrote: »

Assuming joint tenants,can the creditors force a sale for unsecured third party debt??

In the case of joint tenants the property becomes the sole property of the survivor so I can't see how any claim can be made against it. AFAIK the only time the value of the deceased's share is of relevance is in IHT calculations. Any debtor has six years to make a claim.Only a joint tenant can sever the JT and as it has ceased to exist don't see how any debtors have any claim against the survivor.

Brighty

brewerdave wrote: »

Assuming joint tenants,can the creditors force a sale for unsecured third party debt??

Yes, they would apply for an 'Insolvency Administration Order', which would sever the joint tenancy and force a sale. An insolvent estate is treated just like a living bankrupt person. It would be up to the op to either sell up and pay the debt (upto half the value of the house), or try to negotiate a payment plan, if they wanted to keep the house.

http://www.summitlawllp.co.uk/blog_detail_121_Death-of-the-Debtor:-Insolvency-Administration-Orders

The only way out of it is to not apply to be executor or administrator of the estate, so you have no obligation to settle the estates debts. Then keep your fingers crossed for the next 5 years that the creditor does not apply for an 'Insolvency Administration Order'. Once 5 years after the death has passed, you're in the clear.

Brighty

Keep_pedalling

Is this house your home?

Tuesday_Tenor

Approximately how much is the 'sizeable amount' of debt?

Yorkshireman99

Brighty wrote: »

Yes, they would apply for an 'Insolvency Administration Order', which would sever the joint tenancy and force a sale. An insolvent estate is treated just like a living bankrupt person. It would be up to the op to either sell up and pay the debt (upto half the value of the house), or try to negotiate a payment plan, if they wanted to keep the house.

http://www.summitlawllp.co.uk/blog_detail_121_Death-of-the-Debtor:-Insolvency-Administration-Orders

The only way out of it is to not apply to be executor or administrator of the estate, so you have no obligation to settle the estates debts. Then keep your fingers crossed for the next 5 years that the creditor does not apply for an 'Insolvency Administration Order'. Once 5 years after the death has passed, you're in the clear.

Brighty

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