Mortgage situation after death

SturtM

Hi all,

Wondering if anyone has an educated view on the following situation:

A family member had an english mortgage on a property in spain. She has recently died so I assume the mortgage company will repossess the house (which none of the beneficiaries object to). We are not sure if the value of the house will exceed or be equal to the outstanding mortgage debt. If it does not, will they make claim for the difference against the remainder of her english estate?

Will they value the house and if valuation is sufficient take that or do they actually have to sell the house and the sale figure is used?

The lender has been notified - is there a fixed period in which they have to respond, beyond which they cannot claim against the remainder of the estate?

Solicitors are being slow and inconsistent in the information they are providing and seem to be dragging things out.

Cheers.
SM

Thrugelmir

Who are executors of the estate? They'll have legal responsibility for properly winding up the estate up. Failure to do so leaves the executors personally liable.

silvercar

You need to work out if the estate overall, including this property, will be in credit. If there is only this house and it's sale price won't cover the mortgage than don't meddle but walk away.

Dealing with anything in Spain is a nightmare and there are only two speeds slow and dead slow.

english mortgage on a property in spain

Explain what you mean:
a) a mortgage in Sterling secured on the property.
b) a mortgage in Euros secured on the property in Spain by a British bank.
c) a mortgage in Euros secured on a property in the UK?

SturtM

Hi silvercar, it's b - mortgage in euros secured on property in spain by british building society (who no longer offer these types of loan).

The concern is that if they take the house and for whatever reason deem it to be insufficient to repay the loan, will they claim against the remainder of the estate?

davidmcn

SturtM wrote: »

The concern is that if they take the house and for whatever reason deem it to be insufficient to repay the loan, will they claim against the remainder of the estate?

The executors have a duty to repay any debts from the estate (as a whole), I don't think the international aspect makes a difference to this.

Why are you assuming the house would be dealt with by repossession - can't it be sold voluntarily by the executors? Assuming that would result in a better net price than a repossession sale, the executors have a duty to do that (though might be academic if the executors and beneficiaries are one and the same).

beecher2

I can't see the lender doing anything immediately - as others have said it is surely far better for the executor to put the property up for sale now.