Housing Association - credit balance at time of death

Simon7685

My mother died on 25 August and I am dealing with her estate as I am the sole executor of her will.
I have not needed to apply for probate as there is no property, insurance, or money involved, just her personal possessions. Being a lady of a certain age she wanted everything done properly so still had a will made even though she had no money to speak of and my daughter and I are the only family.

I have been able to get a credit card debt written off by the bank and also a DWP overpayment of benefit from February which only came to light after her death.

I contacted her housing association after her death, who decided that she had to give 4 weeks notice to quit her tenancy. At the time I was not worried about that as she had no money and therefore no means of paying the rent which they said would be charged to the estate until the notice period ran out. However after ringing them last week to find out exactly what the position of her rent account was I was shocked to be told that at the time of her death there was a credit balance of £822.51 on her account and this had been the case for a number of years (since 2014)!

They advised me that after taking the rent for the notice period plus a week from when housing benefit ceased there would be £281.91 owed which would be paid to me. However this was dependant on her flat being left as per her tenancy agreement and no repairs being charged to her and it would not be sorted out until 27 October, a further month on from the end of the tenancy.

As I understand it the law states that the first thing that has to be paid is the funeral, which was £2300 and if there was any money left creditors would then be paid in a set order.

I am writing to her housing association and advising them that I require them to pay me the amount of the full credit balance at the time of her death and that they can then make a claim against the estate for the months rent they want.

I have been left with the funeral to pay for, which being on Universal Credit and PIP myself I can ill afford to do. I have submitted a claim for a funeral payment, which I am waiting to hear about but the undertaker has said the average payment is around £1600 max, so there will still be a large amount to pay. He is happy to wait for his money and has said once I know what I owe we can work out a plan for the balance I will owe him.

Essentially what I am trying to find out is am I within my rights to demand the full credit balance on my Mothers rent account at the time of her death, as this will cover the difference I am going to owe for the funeral.

Also if the housing association refuse to give me what in fact is my Mothers money can I pursue it through the courts if necessary?

It also begs the question as to why they allowed her to get so far in credit with her rent without refunding it in the first place. However that is a question for later on, as the priority is getting the money refunded now so I can pay for the funeral.

I have tried contacting Citizens Advice but they are so busy where I live that you can never get to speak to anyone. Obviously I cannot afford a solicitor so I thought some of you on here may be able to help and offer some advice.

Thanks in advance:)

Malthusian

The housing association can net any debt owed by your mother against the credit they owe her. They are under no obligation to pay for her funeral by paying out the gross amount.

You did not have to pay for a funeral for her but it sounds like that's spilt milk.

You may want to look into a Debt Relief Order if you cannot afford to repay the outstanding funeral debt after the estate has paid what it can.

pip895

It does seem a bit off to expect someone who dies to give 4 weeks notice though! Trying to get them to wave that would be your best approach..

Keep_pedalling

pip895 wrote: »

It does seem a bit off to expect someone who dies to give 4 weeks notice though! Trying to get them to wave that would be your best approach..

4 weeks is the minimum notice that has to be given by either the landlord or the representative of the estate. This gives the administrator time to clear the property.

https://england.shelter.org.uk/housing_advice/council_housing_association/what_happens_to_a_tenancy_when_the_tenant_dies

Malthusian

pip895 wrote: »

It does seem a bit off to expect someone who dies to give 4 weeks notice though!

As per Keep Pedalling, it would seem a bit off to expect an administrator to drop everything and turn up to clear the flat before the body has even cooled.

Four weeks is a reasonable amount of time to sort that out, and while the flat can't be inhabited by someone else because it's full of the estate's stuff and needs cleaning, the estate needs to pay for it. It's not the landlord's other tenants' responsibility (who would pay if deceased's estates could occupy flats for free).

Simon7685

Well I have sent a letter to the housing association asking for a refund of the full credit balance at the time of death. I take the point of the estate paying for the time the flat is not generating income for them but in this instance I feel it is slightly different.

They have not supplied rent statements since 2015. There policy is that credit balances above one weeks rent are supposed to be automatically refunded and that did not happen. If rent statements had been issued the issue would have come to light quite sometime ago and a refund requested, so they would not have that balance to now draw on.

There are numerous complaints from residents at this scheme as despite tenancy agreements stating that rent should be paid one week in advance, they are sending letters to residents telling them they are in arrears. The reason being given is they have decided that tenants now have to be one month in advance irrespective of what the tenancy agreements state!

Whether or not I get any success remains to be seen but I feel I have to at least try. If the housing association had played fair and by their own procedures that money would not have been in their possession as it would have been refunded. Had they sent rent statements I would have been aware and the money would have been refunded a long time ago.

Malthusian

Simon7685 wrote: »

They have not supplied rent statements since 2015. There policy is that credit balances above one weeks rent are supposed to be automatically refunded and that did not happen.

In which case they should pay the estate interest on the rent they failed to refund.

Their failure to repay the credit balance within the agreed timescale does not however oblige them to write off four weeks' rent or repair costs. If they do write it off to avoid a fight, then brilliant, but I would plan for the possibility that they only refund the net amount.

Whether or not I get any success remains to be seen but I feel I have to at least try. If the housing association had played fair and by their own procedures that money would not have been in their possession as it would have been refunded.

And the likelihood is that your mother would then have spent the money (no judgment here, it seems a reasonable assumption based on the fact that there was minimal cash in the estate other than the rent credit balance) and none of it would be available to pay for her funeral.

Dandylion

I think the credit balance belongs to the estate, and the 4 weeks notice is owed by the estate. So if funeral costs take priority, the credit balance would have to go towards the funeral, and anything left goes to the HA (unless they waive it). However, this may then reduce the amount of funeral payment you get as I understand the DWP reduce the funeral payment award by how much money is in the estate. It might be worth looking at the funeral payment rules - are you obliged to tell the DWP about money discovered in the estate AFTER you’ve applied?

Malthusian

Dandylion wrote: »

I think the credit balance belongs to the estate, and the 4 weeks notice is owed by the estate. So if funeral costs take priority, the credit balance would have to go towards the funeral, and anything left goes to the HA (unless they waive it).

Not correct. The HA can net the debt owed by the estate against the debt owed by the HA. This takes priority over funeral costs.

Funeral costs would take priority if the debt and the credit balance were with completely different entities (and the debt was unsecured).

It is the same position as if you owe £1,000 on a bank loan and have £1,000 in the same bank's current account. The £1,000 in the current account can't be used to pay funeral costs as the bank will net it off against the debt.

unholyangel

I thought I'd replied to this previously but apparently, I didn't.

OP, look up "the right to set off" - which is explained by malthusian above.

Unfortunately, the reason they had the money is irrelevant. Rather than you being within your rights to have the money refunded to the estate, they are within theirs to offset it against any monies owed to them from the estate.

I'm sorry you find yourself in this position. Losing a loved one is never easy so even the smallest thing can add immense pressure. Never mind financial worries, which is not a small thing by any means.

Fire_Fox

Simon7685 wrote: »

My mother died on 25 August and I am dealing with her estate as I am the sole executor of her will.
I have not needed to apply for probate as there is no property, insurance, or money involved, just her personal possessions. Being a lady of a certain age she wanted everything done properly so still had a will made even though she had no money to speak of and my daughter and I are the only family.

I contacted her housing association after her death, who decided that she had to give 4 weeks notice to quit her tenancy. At the time I was not worried about that as she had no money and therefore no means of paying the rent which they said would be charged to the estate until the notice period ran out. However after ringing them last week to find out exactly what the position of her rent account was I was shocked to be told that at the time of her death there was a credit balance of £822.51 on her account and this had been the case for a number of years (since 2014)!

As I understand it the law states that the first thing that has to be paid is the funeral, which was £2300 and if there was any money left creditors would then be paid in a set order.

I am writing to her housing association and advising them that I require them to pay me the amount of the full credit balance at the time of her death and that they can then make a claim against the estate for the months rent they want.

I have been left with the funeral to pay for, which being on Universal Credit and PIP myself I can ill afford to do. I have submitted a claim for a funeral payment, which I am waiting to hear about but the undertaker has said the average payment is around £1600 max, so there will still be a large amount to pay. He is happy to wait for his money and has said once I know what I owe we can work out a plan for the balance I will owe him.

Essentially what I am trying to find out is am I within my rights to demand the full credit balance on my Mothers rent account at the time of her death, as this will cover the difference I am going to owe for the funeral.

Also if the housing association refuse to give me what in fact is my Mothers money can I pursue it through the courts if necessary?

It also begs the question as to why they allowed her to get so far in credit with her rent without refunding it in the first place. However that is a question for later on, as the priority is getting the money refunded now so I can pay for the funeral.

You are muddling up your two distinct roles. Either

with your 'executor hat' on you acted incorrectly organising a funeral you knew that the deceased's estate could not honour.

with your 'bereaved son hat' on you organised a funeral you knew you could not afford, but decided to find a way.

Unfortunately either way you are personally liable for the shortfall.

I am concerned it would be a further misuse of your 'executor hat' to pursue the HA for money to offset your personal liability. I suggest any money is paid directly to the undertaker.

Where an estate is insolvent, the local council can be asked to organise a basic funeral. They will not inform anyone where or when this occurs.