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Outstanding Loan on death of a partner

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  • Outstanding Loan on death of a partner

    I would be grateful for any advice anyone could give me on the following issue my recently widowed niece has.

    My niece's husband recently passed away at the age of 56 yrs. He had sometime before his death taken out a loan with a bank and having advised them of his passing they have written back informing her of the outstanding balance and asking if his estate will have sufficient funds to cover it. Their letter is very gently worded and clearly points out that she isn't being asked to pay the loan directly herself, but it has raised a question I her mind regarding what is classed as part of his estate.

    They had a Joint Bank Account while he was alive, which has obviously now become her sole account. Our question is,

    Q) As the account was JOINT what is now deemed, if anything, to be part of his estate? Would it be a 50:50 split, or is whatever is in it now classed entirely as hers and no longer his estate?

    He has no other funds or assets.

    Many thanks for any assistance you can offer.
    Last edited by Annjeo; 9th April 2016, 13:53:PM.
    Tags: None

  • #2
    Joint bank account and an outstanding loan at death.

    I would be grateful for any advice anyone could give me on the following issue my recently widowed niece has.


    My niece's husband recently passed away at the age of 56 yrs. He had sometime before his death taken out a loan (in his name only) with a bank and having advised them of his passing they have written back informing her of the outstanding balance and asking if his estate will have sufficient funds to cover it. Their letter is very gently worded and clearly points out that she isn't being asked to pay the loan directly herself, but it has raised a question in her mind regarding what is classed as part of his estate.


    They had a Joint Bank Account while he was alive, which has obviously now become her sole account. Our question is,


    Q) As the account was JOINT, what is now deemed, if anything, to be part of his estate? Would it be a 50:50 split, or is whatever is in it now classed entirely as hers and no longer his estate?


    He has no other funds or assets.



    Many thanks for any assistance you can offer.

    Joanne

    Comment


    • #3
      Re: Outstanding Loan on death of a partner

      Could administration delete this post as I have copied it to the Bereavement section, where I believe it may be more appropriate.

      Thank you.

      Comment


      • #4
        Re: Outstanding Loan on death of a partner

        On the basis that the account was held by "joint tenants" and not "tenants in common" the balance of the account will pass
        to the surviving account holder on death by right of survivorship. So it is entirely hers!!

        Comment


        • #5
          Re: Joint bank account and an outstanding loan at death.

          Have responded on your original thread (which ain't been deleted [yet]!)

          Comment


          • #6
            Re: Outstanding Loan on death of a partner

            Please remember that regular possessions are not counted as estate nor are any insurance policies IF they have a named benefactor.
            The first debt to be paid is funeral costs and reasonable executor or administrative expenditure. Assuming there was no property I suspect that a letter stating there are a insufficient assets to meet outstanding commitments will suffice

            Comment


            • #7
              Re: Outstanding Loan on death of a partner

              The sole loan account of the deceased person is not one that the surviving account holder is liable for...
              "Family means that no one gets forgotten or left behind"
              (quote from David Ogden Stiers)

              Comment


              • #8
                Re: Outstanding Loan on death of a partner

                Originally posted by Noah View Post
                Please remember that regular possessions are not counted as estate nor are any insurance policies IF they have a named benefactor.
                The first debt to be paid is funeral costs and reasonable executor or administrative expenditure. Assuming there was no property I suspect that a letter stating there are a insufficient assets to meet outstanding commitments will suffice
                The only property there was/is is their house, the mortgage for which has been cleared by the mortgage insurance they paid for. So, the house is now in her name and mortgage free.

                Comment


                • #9
                  Re: Outstanding Loan on death of a partner

                  threads merged xxx
                  #staysafestayhome

                  Any support I provide is offered without liability, if you are unsure please seek professional legal guidance.

                  Received a Court Claim? Read >>>>> First Steps

                  Comment


                  • #10
                    Re: Outstanding Loan on death of a partner

                    Originally posted by Annjeo View Post
                    The only property there was/is is their house, the mortgage for which has been cleared by the mortgage insurance they paid for. So, the house is now in her name and mortgage free.
                    I believe, but don't quote me, it will depend on how the house ownership was set up as to if it became part of the estate maybe [MENTION=77627]Openlaw15[/MENTION] could clarify that

                    Comment


                    • #11
                      Re: Outstanding Loan on death of a partner

                      Most married people hold their home as joint tenants, and on the death of one the whole property passes to the survivor.

                      If, more unlikely, they were tenants in common then the deceased's share (not necessarily 50%) is passed on as per the will (if one exists) or as per the laws of intestacy,

                      Comment


                      • #12
                        Re: Outstanding Loan on death of a partner

                        Originally posted by Noah View Post
                        I believe, but don't quote me, it will depend on how the house ownership was set up as to if it became part of the estate maybe @Openlaw15 could clarify that
                        There can be two types of ownership, 1) a beneficial joint tenancy and if it applies the Will does not count as the property automatically passes to its joint owner (under the survivor rules). 2) It would require a severance (ie a statement that effect) of the beneficial joint tenancy (JT) and then their share in the property is automatically a tenancy in common (T in C). A tenancy in common means the property does not pass to the surviving joint tenant, so any Will they make is effective. It is presumed that there is a beneficial joint tenancy between a married couple as Desm indicates above. There could be more than one tenancy in common and beneficial joint tenant if the property were a large land estate so the law is the first 4 named and of age/ capacity (sui juris) are beneficial joint tenants and the rest are tenancy in common: Law of Property Act 1925. This presumption of beneficial joint tenancy can be rebutted however albeit the situation is usually discussed when the couple are signing the deeds at the solicitor's. The solicitor has a duty to enquire which one should apply and explains the pros and cons for both JT and T in C (Tenancy in Common). The rule of thumb is if there is no tenancy in common recognised by the words 'implied trust' under 'absolute ownership' on the land register's property it is presumed the couple intended a beneficial joint tenancy from the outset. If the property is not registered I believe it's still beneficial joint tenancy unless the presumption can be rebutted.

                        Comment


                        • #13
                          Re: Outstanding Loan on death of a partner

                          In English?

                          I remember it being explained to me as either
                          Both owned all the property in which case when one died the other took on the ownership
                          Each owned a portion of the property -usually half , when one died their half became part of their estate

                          I can not remember which is which though

                          Comment


                          • #14
                            Re: Outstanding Loan on death of a partner

                            Originally posted by Annjeo View Post
                            I would be grateful for any advice anyone could give me on the following issue my recently widowed niece has.

                            My niece's husband recently passed away at the age of 56 yrs. He had sometime before his death taken out a loan with a bank and having advised them of his passing they have written back informing her of the outstanding balance and asking if his estate will have sufficient funds to cover it. Their letter is very gently worded and clearly points out that she isn't being asked to pay the loan directly herself, but it has raised a question I her mind regarding what is classed as part of his estate.

                            They had a Joint Bank Account while he was alive, which has obviously now become her sole account. Our question is,

                            Q) As the account was JOINT what is now deemed, if anything, to be part of his estate? Would it be a 50:50 split, or is whatever is in it now classed entirely as hers and no longer his estate?

                            He has no other funds or assets.

                            Many thanks for any assistance you can offer.
                            Not all estate on the death of the deceased needs to go to probate. If there are joint transactions, ie in properties in bank accounts, technically these do not require going through probate. However, the bank will often require proof of death as will the mortgage company (if a mortgage were still outstanding). Joint bank account means a bank account that is owned between the joint holders, so on death the survivor takes the lot. If the loan were taken out prior to his death was in joint names then all survivors remain liable for the debt, if it was in his sole name then there is no claim. The loan company has to prove its debt first against the estate. Normally, all debts must be dealt with by advertising in the London Gazette (the government paper) for any debtors to come forward before the estate can be distributed. The executor is responsible for this. If the debt was not known about the executor can't be responsible. However, a gentle letter from the loan company is a 'softly softly catchie monkey' attempt to recover the debt from the estate without it having to take legal action, ie a voluntary offer to the loan company. There is no obligation for the estate to hand over the debt if the loan in in the deceased's name. At best if any claims are to be made by the loan company it will have to be via a court, probably a County Court, as it's a civil matter. It will simply have to prove the debt.

                            Comment


                            • #15
                              Re: Outstanding Loan on death of a partner

                              Originally posted by Noah View Post
                              In English?

                              I remember it being explained to me as either
                              Both owned all the property in which case when one died the other took on the ownership
                              Each owned a portion of the property -usually half , when one died their half became part of their estate

                              I can not remember which is which though
                              Ok let's simplify things. Joint ownership (or beneficial joint tenancy) means the property (estate) is owned between 2 or more people. Imagine a joint tenancy like a property with its owners stuck inside. If one dies the dead person is taken out, so the person remaining owns the property. Joint tenancy means not having a share but owning between them. Tenancy in common means the opposite.

                              Comment

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