house valuation help please

exorcist

Hi all ,
heres the situation ........a relative has passed away leaving a will main beneficiary is his wife with specific gifts of small items of only sentimental value left to others .
The main sticking point is that the bank who the mortgage is with want deed of probate for the executors to be able to act in respect of the mortgage .
the mortgage was a " tenants in common " mortgage not a joint mortgage , im familiar with the details of such and how it works , just stating this is why probate required .
Now the real question is when valueing the property for probate purposes what figure do i declare ?
House is valued now at £350,000 there is outstanding £135,000 mortgage (currently paying interest only ) term ends in 6 yrs and a policy pays that figure off .mortgage is tenants in common as i said so when valueing for probate do i value it at 350k or as only one of the mortgage holders has died just declare his half of 175k as being part of his estate ?
any guidence appreciated .

getmore4less

There is no such thing as a tenants in common mortgage.
All mortgages are joint.


If the house and mortgage are in both names they become one name death is a factual event.


The land reg can be updated to remove the deceased owner.

Don't need probate to sell.

For IHT read the notes on the IHT forms they explain valuation of properties.
The property value and debt go in seperate places.

As transfers to spouse are exempt the value debt numbers don't change the tax position.

Alter_ego

Is the house owned as Tenants in common or Joint (with land registry)?

xylophone

There is no such thing as a tenants in common mortgage.
All mortgages are joint.

https://forums.moneysavingexpert.com/discussion/5118119/sole-mortgage-joint-ownership-a2-indirect-legal-charge

Is it possible that while husband and wife held the property as tenants- in common, only the husband was named on the mortgage(see above)?

getmore4less

That type of setup where the borrower(s) dies causes issues as the whole property is the security for the debt and the mortgage will need to be redeemed before the living TIC owner can do anything with the property.

If the estate/living owner can't resolve the debt the house can be sold to pay the debt.
(repossession if needed).


Ownership and mortgage setup needs clarification.

Keep_pedalling

As far as the numbers are concerned, you declare value of his share of the house, presumably 50%. The mortgage is a dept so his share of the mortgage goes in section 10.1 on IHT 250.

I am presuming from this there was no life insurance covering the mortgage, in which case his widow is facing a major problem when the mortgage term comes to an end, or immediately if she can’t afford the payments.

Edit. Sorry just reread the opening post. You say a policy pays it off at the end, but those sort of policies usually pay on the death of a policy holder. If that is the case you should be able to clear the mortgage and not require probate.