Deceased Fathers mortgage

louise287

This is a really complicated thread so I will explain as best as I can.

My dad passed away in 2011 due to stomach cancer. He had taken out a mortgage on our house years before and remortgaged so the total left was 118,000. It is an interest only mortgage therefore in four years time the interest is paid and the amount outstanding is the £118,000.

Unfortunately he did have life insurance but for some reason unbeknown to us he stopped paying it in 2010. Alarm bells ring everytime I think of this because this was not like my Dad. He absolutely devoted his life to his kids and always told me the most important thing to him was the house being left to us. So why cancel after paying for years.

Regardless of this, when these four years are up we are in rocky territory. My siblings have moved on and im planning to buy a new home with my boyf.

My mum will be here, on benefits (she cannot work due to illness). Do we have a leg to stand on? Or are we literally just going to have to give our family home up? My mum cannot apply for a remortgage in her situation?

Any help would be much appreciated.

getmore4less

Why was nothing done in 2011?

Can you confirm it was a joint mortgage and mum was a joint owner of the house?

worried_jim

Hopefully the house has some equity so you'll be able to sell it and use that money to downsize (should easy as all your siblings have now moved away) and buy a place outright, that's why so many people went interest only, it was cheaper than rent and you built up equity.

davidmcn

Your plan when you asked us three years ago was to take over the mortgage for the property:

https://forums.moneysavingexpert.com/discussion/comment/65479882#Comment_65479882

Why can't you still do that, if keeping the house is a priority?

Harryp_24

so his most important thing to him was to leave the house to the kids so he remortgages it? wheres the money from that?

getmore4less

2014 £50k
2017 £118k

really need some clarification on what has been done since DOD Sept 2011 to the first post in May 14 and then til now.

silvercar

If it was a joint mortgage with Mum and you are now all leaving home, Mum may be able to claim SMI (support for mortgage interest) which is the benefit for owners in the same way that renters can claim housing benefit.

Your problem may be persuading the lender to continue the mortgage beyond its current end date. Eventually the mortgage needs to be repaid and downsizing may be the only option in time.

Lenders like the family building society have products to enable you to keep the home for longer, but this will only be a short term solution.

louise287

When he remortgaged years before he died they used the money for repairs on the house etc. The house was valued at £150,000 at the time so remaining balance after the interest is paid would be £118,000. My old posts were confusing I know but for some reason I thought it was £40,000 left to pay, thats actually what the orginal mortgage cost for the house years and years ago.

The problem we have is being able to continue paying the mortgage after the interest is paid as my Mum can't take it over herself and I'll be moved out by then (hopefully). Hopefully this makes more sense. I realise I am blabbering a bit, i admit I never thought any of this would be an issue and I'd need to seek some advice.

PasturesNew

silvercar wrote: »

... claim SMI (support for mortgage interest) which is the benefit for owners in the same way that renters can claim housing benefit....

I believe this is probably not an option as it's the not the first/original mortgage, a much larger mortgage was taken out since the original mortgage.

It depends in part how that 2nd mortgage was spent: https://www.gov.uk/support-for-mortgage-interest/overview

getmore4less

I suspect if you dig deeper into the family finances all was not well.

If the original was £40k/£50k and now £118k that's £60k+ a lot to spend on fixing a £150k house

anyway

a downsize is probably the best solution.

dimbo61

Your mum will have to sell up and move into a over 50/55,s sheltered accommodation.
It is not that bad and she will only have the rent to worry about.
No garden or building repairs.
Money in the bank to enjoy life and travel