Which debts do I pay

Yorkshireman99

windsorian wrote: »

I was very interested to find this thread, and I'm hoping that someone could give me some advice please. My estranged husband died a few weeks ago, and left nothing but debts, including his bank account. I arranged his funeral, which of course I will have to pay for, but now I am wondering what to do about his debts. His will left his half of the house (which I am living in) to me, as we are Tenants in Common. Without the house, his estate would be insolvent. Can creditors force me to settle his debts, as naturally I don't want to have to sell the house to release his equity? SSE, bless 'em, immediately wrote off his debt.
Our 2 sons were named as executors, but neither want to administer the estate, so I have done the Application for Probate. Does that make me liable for the debts?

What is the size of the debts? His half of the house forms part of the estate and in theory the debtors can force a sale. You are not personally liable for his debts. Before you apply for probate get some advice from a solicitor.

Keep_pedalling

Yorkshireman99 wrote: »

What is the size of the debts? His half of the house forms part of the estate and in theory the debtors can force a sale. You are not personally liable for his debts. Before you apply for probate get some advice from a solicitor.

As the person administering the estate she is responsible for seeeing those debts are paid, and as the beneficiary can't receive her bequest at the expense of the creditors, so in effect she has become responsible.

For the time being as administrator she need the write to the creditors requesting a final statement of accounts. So that the dept can be settled after probate has been granted.

I don't thing she should request to pay by instalment as this could involve high interest charges, better to look at raising cheaper funds which should not be difficult for a £8000 dept against a £1/2M home.

In the longer term she should at least consider downsizing, as being asset rich but cash poor is not a great position to be in when your boiler breaks down or the roof starts leaking.

windsorian

The debts amount to almost £8000 including the funeral costs (which I have paid) so far, if I allow around £1000 which may be owed to HMRC. I have already done the PA1 and IHT205 which have gone to the Probate Registry this week. Naturally I don't want to sell the house, that would cause even more problems for me. So to protect that, I assumed I would have to pay the debts he's left, including his overdraft, if I was the Administrator/Executor. I'm not sure which are secured and unsecured debts, and which I could possibly tell to go and take a running jump.

Yorkshireman99

windsorian wrote: »

The debts amount to almost £8000 including the funeral costs (which I have paid) so far, if I allow around £1000 which may be owed to HMRC. I have already done the PA1 and IHT205 which have gone to the Probate Registry this week. Naturally I don't want to sell the house, that would cause even more problems for me. So to protect that, I assumed I would have to pay the debts he's left, including his overdraft, if I was the Administrator/Executor. I'm not sure which are secured and unsecured debts, and which I could possibly tell to go and take a running jump.

It may sound harsh but as executor your primary responsibility is to the estate without consideration for your own financial position. The debts have to be dealt with fairly and telling a debtor to go away is not an option. You have no personal liability for the estate's debts. Probably the best option is to raise a laon to oay them off rather than have a house sale forced. You really must get paid for professional advice rather than rely on what people say on here.

windsorian

Yorkshireman99 wrote: »

It may sound harsh but as executor your primary responsibility is to the estate without consideration for your own financial position. The debts have to be dealt with fairly and telling a debtor to go away is not an option. You have no personal liability for the estate's debts. Probably the best option is to raise a laon to oay them off rather than have a house sale forced. You really must get paid for professional advice rather than rely on what people say on here.

Yorkshireman and Keep pedalling, thank you both very much for your invaluable advice.
I will get myself a loan, request final balances from creditors, and when I have Probate I will pay them off, then I have only the loan to service. In the meantime, I will put a notice in the local paper re his death - the Gazette is scandalously expensive - to see if there are any more creditors.

Yorkshireman99

windsorian wrote: »

Yorkshireman and Keep pedalling, thank you both very much for your invaluable advice.
I will get myself a loan, request final balances from creditors, and when I have Probate I will pay them off, then I have only the loan to service. In the meantime, I will put a notice in the local paper re his death - the Gazette is scandalously expensive - to see if there are any more creditors.

If you don't put the notice in the Gazette you will not be protected against debtors. It would be very unwise not to do it despite the cost.

Yorkshireman99

Keep_pedalling wrote: »

As the person administering the estate she is responsible for seeeing those debts are paid, and as the beneficiary can't receive her bequest at the expense of the creditors, so in effect she has become responsible.

For the time being as administrator she need the write to the creditors requesting a final statement of accounts. So that the dept can be settled after probate has been granted.

I don't thing she should request to pay by instalment as this could involve high interest charges, better to look at raising cheaper funds which should not be difficult for a £8000 dept against a £1/2M home.

In the longer term she should at least consider downsizing, as being asset rich but cash poor is not a great position to be in when your boiler breaks down or the roof starts leaking.

Why should the debtors charge interest? Their entitlement is to the debt as at the date of death. If the total debts are £8k minus the funeral cost of say £4K the OP should be able to negotiate paying without added interest. She needs to be hard nosed about this with the creditors..

windsorian

Yorkshireman99 wrote: »

If you don't put the notice in the Gazette you will not be protected against debtors. It would be very unwise not to do it despite the cost.

So you're saying that if a notice is put in the Gazette, and creditors don't come forward in the 2 months following, they are legally barred from applying for payment? :undecided It's money for old rope - something like £60 + VAT!! But worth it I guess if they would be barred.

windsorian

Yorkshireman99 wrote: »

Why should the debtors charge interest? Their entitlement is to the debt as at the date of death. If the total debts are £8k minus the funeral cost of say £4K the OP should be able to negotiate paying without added interest. She needs to be hard nosed about this with the creditors..

I will certainly ask creditors if they would accept instalments, and go from there. Would save having to get a loan! But I do doubt HMRC would accept instalments, but s'pose you never know if you don't ask.

windsorian

Yorkshireman99 wrote: »

If you don't put the notice in the Gazette you will not be protected against debtors. It would be very unwise not to do it despite the cost.

I've just found this on the Gazette's own site :-
A deceased estates notice specifies a two-month period for claimants to contact the executor to register a claim against the estate. Once that time has expired, the executor may distribute the estate, having regard only to the claims they have received notice of. A creditor who misses the deadline has no recourse against the executor personally, but can still pursue the beneficiaries who receive the estate.



Since I'm the only beneficiary (of his share of the house), it would seem that I would be liable for debts whether or not I place an entry in the Gazette. So, I think I will save the money against the debts I've identified.