Using bank account before probate

jsatellite

My mum's bank will release the funds in her accounts to me without needing probate - although I need it to sell her house at least. I plan to open a regular current account for this rather than use my own account for the sake of transparency. Am I then OK to start collecting other assets and paying debts and expenses (there's enough without waiting for the proceeds from the house)? Or should I wait for the probate application to go through first? Obviously I won't distribute the funds to the beneficiaries (myself and my sister) until everything else is done with.

Keep_pedalling

jsatellite said:

My mum's bank will release the funds in her accounts to me without needing probate - although I need it to sell her house at least. I plan to open a regular current account for this rather than use my own account for the sake of transparency. Am I then OK to start collecting other assets and paying debts and expenses (there's enough without waiting for the proceeds from the house)? Or should I wait for the probate application to go through first? Obviously I won't distribute the funds to the beneficiaries (myself and my sister) until everything else is done with.

Provide you are sure there are no large debts that your are yet to discover this should not be a problem.

xylophone

Why not simply wait until probate is granted and then open an executor's account?

jsatellite

xylophone said:

Why not simply wait until probate is granted and then open an executor's account?

Is there any advantage to using one over a new current account?

xylophone

Is there any advantage to using one over a new current account?

Other posters have said that they simply opened an account in their own name and used that to collect in estate assets.

I am perhaps being pernickety but it has always seemed to me that a personal account is just that - if acting in an official capacity, it seems to me correct to open the account appropriate to the circumstances.

p00hsticks

xylophone said:

Is there any advantage to using one over a new current account?

Other posters have said that they simply opened an account in their own name and used that to collect in estate assets.

I am perhaps being pernickety but it has always seemed to me that a personal account is just that - if acting in an official capacity, it seems to me correct to open the account appropriate to the circumstances.

I think the issue is that currently, going by this board, many banks don't seem to like opening executors accounts at all, and those that do want you to have probate, which is currently taking eight weeks or more.

Plus many people now have multiple bank accounts as a matter of course. If there is a property involved, bills (utilities, insurance etc) really need to be switched straight away to keep on getting paid.

We took the approach to use an existing perosnal account that only has estate money coming in and out in the short term, with a view to getting an executors account to receive the proceeds of the house sale and distribute the estate once we've obtained probate.

getmore4less

Named executors get their powers from the will.

Other administrators should wait but no one seems to care or just let's people get on with it.

Pennylane

I asked my late Mum’s Bank whether I needed to open an Executors account and they said no.

naedanger

jsatellite said:

xylophone said:

Why not simply wait until probate is granted and then open an executor's account?

Is there any advantage to using one over a new current account?

The legal position of the money would be clearer. If you just use a personal account things might become more complicated in certain situations e.g.

• If you defaulted on another account with the bank then what happens if they seize the money in the personal account you were using for estate purposes?
•  If you died then the executors of your estate would have to sort out what was happening with the account you set up for this other estate. 
• What if you died and your own estate was insolvent but this other account had a lot of money in it. No-one might be willing to administer your estate which would leave the other estate with the legal problem of how to access the money in the personal account set up for the other estate's assets.

That said I just set up a personal account to deal with an estate recently. (However had my own finances been in a poor state then I might have been less inclined to do so.) I found it was a significant administrative advantage being able to pay bills for the estate prior to probate.

maman

I think the Executors account is totally a 'what if' approach. Of course it could happen that you died with the money from the estate in a personal account but I'd take the risk. Since the money laundering regulations came in, it can be such a faff opening a new account.

I was Executor for my mother's estate. I sorted everything through one of my own accounts and kept a balance sheet with the details that I could show, if interested (they weren't) to the other beneficiaries (my brothers). I did get a call towards the end asking me why I'd issued such a large cheque to XXX (my brother) but when I explained they were fine about it. 

BooJewels

On speaking to the bank, they recommended against an Executors account, as they don't run like normal bank accounts - and especially in Covid times, were going to be difficult to set up anyway.  I was doing this in the middle of the first big lockdown and it would have necessitated both executrices (my sister and I) attending the bank together and then signing everything jointly.  I have a feeling that she said you couldn't pay Direct debits from executor accounts - and we needed this to pay insurance and utility bills etc.

She recommended that they were certainly beneficial in large and complex estates where you were selling shares and multiple assets and with many beneficiaries, but for simple cases, they'd perhaps cause more trouble than they were worth.  So I opened a new current account with a view that we can go into a branch and add my sister at any point if we want, but she's really not bothered to do that.  So everything goes through that account and I keep spreadsheets with simple accounts for everything and send my sister a monthly summary and screen grab of the bank statement.  It's not very interesting, as most months only 3 DDs go out and not much else.

I've been doing this for almost a year and we've only just applied for probate, so it's certainly both necessary and allowable to pay bills etc. before probate is granted.  We only really need probate to sell the house, there wasn't enough money or other assets that might have needed it.