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Would appreciate any advice whatsoever after parent died intestate.

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Would appreciate any advice whatsoever after parent died intestate.

edited 30 November -1 at 12:00AM in Mortgages & Endowments
4 replies 570 views
Marshall218Marshall218 Forumite
6 posts
edited 30 November -1 at 12:00AM in Mortgages & Endowments
I am re-posting this in here after getting some fantastic advice on the “Probates” forum.
I apologise in advance for what may be stupid questions to ask; I, unfortunately, do not understand anything about how this sort of thing works and I did not envisage having to deal with this situation.

My mum died intestate and has left an amount of debt totalling to around £65,000, of which around £37,000 is the mortgage on her house.

I am her only child and she died single so I have been made the executor of her estate. I have had her house valued at £105,000.

I would like to move into the property. I have had bad credit in the past (defaulted on an account as recently as three years ago) but am now debt-free and currently have £30,000 in savings.

A reply from MovingForwards told me to do the following...
You don't have to 'buy' the house from the estate as you are the only beneficiary, you just need to mortgage the property enough to cover you mom's outstanding mortgage and any other debts.

Speak with a whole of market mortgage broker to see what lenders are available to you.

I then asked if I could put down a deposit of £30,000 and get a mortgage for £65,000, pay off the debts and then I would own the property with a mortgage of £35,000? TBagpuss replied with...
You don't need a mortgage of £65,000 in the first place if you already have £30K savings. You only need £65,000 in total, including your savings, t clear your mum's debt.

So the way to go would probably be to apply for a mortgage of £39,000* to clear your mum's mortgage (and at the same time, transfer the house to your name), and use your £30,000 to clear the other debts your mum had.

That leaves you with a £39K mortgage on a house worth £105k - you don't need to pay a separate deposit as you have the equity in the house already. It's the equivalent of putting down a deposit of £66,000.

* technically you could get a mortgage for £35K, and use the last £4K of your savings towards paying off the mortgage, but in reality you will probably have other expenses, such as legal costs, so you may find that it makes sense to borrow the full £39K and have a bit of leeway for unexpected costs / emergencies

Would this all be possible? If so, what would be the steps I need to take with regards to obtaining a mortgage with my bad credit history? Who would you recommend speaking to?

Further information, I am in full-time employment and earning around £23,000 a year. I would be moving in with my girlfriend who earns £18,000 a year.

Replies

  • MovingForwardsMovingForwards Forumite
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    Good morning, glad to see you made it over here.

    I forgot to say about listing you bad credit details!

    Age of missed payments
    Year of defaults
    Amount of each default
    Whether you have any CCJs / IVA/ bankruptcy.

    That will give the brokers a lot more information to go on, there are a couple of adverse brokers who hang out here.

    (I am actually using one for my mortgage as I liked how he came across on the forum and when dealing directly with him).
  • Good morning, glad to see you made it over here.

    I forgot to say about listing you bad credit details!

    Age of missed payments
    Year of defaults
    Amount of each default
    Whether you have any CCJs / IVA/ bankruptcy.

    That will give the brokers a lot more information to go on, there are a couple of adverse brokers who hang out here.

    (I am actually using one for my mortgage as I liked how he came across on the forum and when dealing directly with him).

    Three defaults on my credit report. The first defaulted 13/05/2016 (£1,653), the second 06/01/2016 (£707) and the third in 31/01/2017 (£439). No CCJs/IVA/bankruptcy. Any assistance would be greatly appreciated!
  • JMA74JMA74 Forumite
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    Three defaults on my credit report. The first defaulted 13/05/2016 (£1,653), the second 06/01/2016 (£707) and the third in 31/01/2017 (£439). No CCJs/IVA/bankruptcy. Any assistance would be greatly appreciated!

    Placing this case should be relatively simple for most brokers. A good broker skilled in adverse cases might be able to sneak you on the high street (more likely when that £439 one goes past 3 years) but I suspect you might be slightly off the high street rates. Nothing horrific though.

    The good news based on the situation you are in is that your mortgage wont be that big. so the difference between a 2% mortgage and a 5% mortgage over 20 years for instance may only be £50-£60 a month.

    Overall, it should (subject to full fact find being done) be a fairly normal case for an experienced broker so get in contact with someone and see whats available.
    I am a Mortgage Adviser

    You should note that this site doesn't check my status as a Mortgage Adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.
  • JMA74 wrote: »
    Placing this case should be relatively simple for most brokers. A good broker skilled in adverse cases might be able to sneak you on the high street (more likely when that £439 one goes past 3 years) but I suspect you might be slightly off the high street rates. Nothing horrific though.

    The good news based on the situation you are in is that your mortgage wont be that big. so the difference between a 2% mortgage and a 5% mortgage over 20 years for instance may only be £50-£60 a month.

    Overall, it should (subject to full fact find being done) be a fairly normal case for an experienced broker so get in contact with someone and see whats available.

    This is promising news, thank you!
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