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Inheritance

Bailey1980Bailey1980 Forumite
3 Posts
First Post
MoneySaving Newbie
I have a bit of a dilemma. 
My dad, a widower recently passed away and my sister has asked me to deal with all the probate as my dad didn't have a will. 
I am valuing the estate and the issue is that my dad's house is worth about £230K and there is about £100K in terms of liquid assets. 
My sister has always lived in my dad's house - she's never moved out and she is currently between jobs. She's previously said that it was my dad's wish that the house is never sold as it is the "family home". 
The issue is that she obviously needs somewhere to live but it seems she wants to stay in the house; I am concerned about how she is going to afford all of the bills as she  has never had to pay all of them and I think she's counting on receiving some of the liquid assets but in order for that to happen, it would mean that I would have to retain an interest in the house, such as 50/50. However I have a house of my own and I cannot afford to be liable / responsible for a second property and I will be tied into a house that has no real benefit to me but equally I don't want my sister to be homeless and bankrupt. 
I haven't yet broached it with her as I am concerned about how she is going to react and I don't want to fall out over money / inheritance and I just don't know what the best thing will be to do. 
If the house is sold then obviously the sum obtained together with the liquid assets will be split down the middle, but based on previous conversations she has no interest in selling the property and if I don't retain an interest in the house to make sure there is a fair division of assets, she would need to buy me out but I don't think she has the money to do so and with her job situation I'm not sure she would be able to re-mortgage and I am concerned about her affording the bills but she also does not want to sell the house. 
The only other options are is for me to retain a 50/50 interest and then we divide the liquid assets equally but I don't want to be liable for bills if she defaults or have to contribute to the maintenance / upkeep such as a new kitchen and bathroom as I have my own house and if she meets someone and starts a family and uses the house as their home, it would be a bit weird for me to have an interest in their house and if anything happened to her, splitting the house would become even more complicated. 

The las option is to give her the house in its entirely plus half of the liquid assets but everyone is telling me that this would be unfair on me as I'd be losing out on a quite a bit. 

I just really don't know what to do for the best for everyone concerned, 

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Replies

  • RASRAS Forumite
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    Unfortunately, there are many threads on here about this situation. Experience suggests that the sooner it is dealt with the better. Longer term you need to sell and divide the assets

    The good thing is that if you are the administrator (executor when there is no will), then you are the one making the decision about what happens to the house. So I'd advise you to get that sorted pronto. People here can help.

    Ask you sister to contact the Council and apply for Single person's tax credit, for starters. Once probate is granted, read all the meters and transfer those accounts to your sister.
    The person who has not made a mistake, has made nothing
  • edited 30 March at 12:12PM
    Keep_pedallingKeep_pedalling Forumite
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    edited 30 March at 12:12PM
    JGB1955 said:
    It seem to me that your sister has two options:
    1.  get a mortgage for £65K to buy you out of your share of the estate or
    2. take her £165K share of the estate and buy a smaller property.
    She can't have her cake and eat it.  To do so would be grossly unfair. What suggestions has she come up with for sharing the inheritance equitably?
    The OP has more options, and what is best is really down to his/her financial situation and how they feel about their sister.

    With a deed of variation they could split the estate with the OP getting all the liquid assets and the sister getting the house.

    They could split everything 50/50 but with the OPs half of the house being put into a lifetime trust for the benefit of the sister.

    There are plenty of other options but if I was the OP and my own financial position was secure I would consider either of the above.

    As has already been said, the OP should crack on and get letters of administration sorted, once they have those they are in a stronger position to negotiate, and the sister won’t be in the position to throw a spanner in the works by lodging a caveat with the probate office.

    A deed of variation has to be carried out within 2 years of the death so you do not have to rush any decision on this.
  • naedangernaedanger Forumite
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    I suggest you make your sister aware of the situation and ask her to start thinking of possible solutions that are fair to both of you. If she sees it as your problem to sort out then whatever you offer will not be enough, and you will end up making generous compromises yet be seen by her to be acting harshly.
  • Savvy_SueSavvy_Sue Forumite
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    Just checking - does your sister have any special needs or disabilities which mean she is unlikely to be able to pay bills etc without appropriate support? 

    I agree, btw, that cracking on and getting letters of administration would be wise. 
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  • elsienelsien Forumite
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    Anyone who has strong views about their estate after death should make a will. In the absence of one, one party saying “parent always said xyz ” is neither here nor there. 
    It may or may not be an accurate version of the parent’s views, but it’s just not realistic (or even what the beneficiaries may want) for your average 3 or 4 bedder to be retained for generations to come,

    Whatever you decide, even if it’s your sister having a larger share, you need to consider the implications for yourself and make sure it’s something that’s not going to come back and bite you on the backside in the future. 
    All shall be well, and all shall be well, and all manner of things shall be well.

    Pedant alert - it's could have, not could of.
  • wannabe_a_saverwannabe_a_saver Forumite
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    Is 165k enough for a flat in your area?  Somewhere that would be easier for her to maintain and pay the bills for than a big family house?
  • TBagpussTBagpuss Forumite
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    You father might have thought it would be nice to keep the hosue but that isn't going to work.

    I'd approach your sister on that basis. 

    Maybe say something along the lines of  "I know you'd like to keep the house and of course Dad would have liked that if it were possible. It won't be possible for me to keep ownership of the house as well as my home, and of course the other assets in Dad's estate aren't larger enough that we could divide things up with me having the other assets and you having the house.
    If you want to buy me out, so you can keep the house, I'd be happy to do that. It looks on the figures we've got as though that would mean you'd need to be able to get a mortgage for around £65,000. You'd pay that yo the estate, which would then mean you would be able to have the house (with equity of £165K) and I would have the £100K assets plus the£6K you paid for the house, so I would also be left with £165K . Is that something you want to do? f so, I'd be willing to delay putting the house on the market for [set period of time - maybe 8 weeks?] to give you time to talk to a mortgage broker to see f it's a viable option for you, and for you o look at whether yo feel you would be able to afford the running costs of you did buy me out. 
    However, I won't be able to delay longer than that and it does look as though we will need to sell the house, as it isn't practical for me to keep it on, much as I might like to."

    that way, you acknowledge her feelings and what your dad may have said, but you are also setting a firm boundary and managing her expectations.

    As she was living there, she is facing losing her home as well as grieving for your dad, and while it's not at all unreasonable to sell the house, it's worth bearing in mind that she is facing two separate stressful events, so do keep that in mind. 
    All posts are my personal opinion, not formal advice Always get proper, professional advice (particularly about anything legal!)
  • MalMonroeMalMonroe Forumite
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    I'm really sorry for your loss.

    As for the property, it's just bricks and mortar - and things - they aren't half as important as people - I say go with your instinct. If you don't need the house or money, do this: "The last option is to give her the house in its entirely plus half of the liquid assets but everyone is telling me that this would be unfair on me as I'd be losing out on a quite a bit." Does it really matter what 'everyone' says?

    This is your sister. She has asked you to deal with probate, she's happy for you to sort things out and that sounds to me like she trusts you completely. Added to that she's just lost her dad (as have you of course) and now she might be in danger of losing her home. Does it really matter who gets what? Your sister has always lived in your dad's house. So she must have been supportive of him, as he was probably supportive of her. So surely that must account for something here? Did she cook for him and clean while you were living your own, separate life? She really deserves to stay in her home in my opinion because that would be fair to her. 'Everybody' seems to have forgotten that she's been with your dad and supported him for years. 

    If you can afford to do the last option you have described, then go with that. That's what we do for family. At least, that's what my family does. I can't believe some of the harsh comments on this thread.  
  • xylophonexylophone Forumite
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    You keep the £100,000 and transfer the property to your sister's sole name  against a first charge on the property for  £65,000?

    In effect, you would be your sister's mortgagee.

    She could repay you at a certain amount each month (plus interest if required).

    A solicitor would draw up a loan agreement and arrange for the charge to be registered at the LR.
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