One of my pals dad's died, ma mates only just found out that his dad had unsecured loans for £20k - is my mates mum liable for the debt, cos the house they own is in both names.
Shug being serious for once!
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Erm, if it's unsecured, then doesn't the debt die with the father?
I can't see how an unsecured loan could make any claims on property, but I've not been to law school...
I do watch Law & Order quite often though...
Not sure Jeffers, fookin hope so cos ma mate is shitting himself. They are already skint and shocked to fuck cos they had no idea of the situation. It looks like they will definitely have to sell the house one way or another.
I just hope the debt dies with his dad cos his mum is in her retirement years.
Shug wrote: One of my pals dad's died, ma mates only just found out that his dad had unsecured loans for £20k - is my mates mum liable for the debt, cos the house they own is in both names.
Shug being serious for once!
Was there any insurance taken out to cover illness or death when the loan was taken out? If yes, tell the insurers and problem over.
If not:
She needs to speak with the Citizens Advice Bureau asap. The debt will form part of his estate and need to be settled. There is the distinct possibility that they could claim a portion of the house or take a charge out against it. They can do that when you get into financial difficulty so in death they possibly could too.
I hope he had adequate life insurance to take care of any mortgage on the house.
In the US in recent years widows have successfully argued that if they had no knowledge of their husband's financial affairs, then they aren't responsible for their debts - perhaps the same wrinkle is available there
Cheers peeps 
I know he didnae have life insurance, but not sure if he was covered on his loans.
I am going out tonight, so will check back the morra. Cheers for the advice.
Now that I've thought about it a little, any liability should become part of the estate.
After I got the probate I was still paying bills for my mum for almost a year. Then there was the light pole. Luckily the insurance finally paid that one at the end of last year, otherwise I would have had to fork out for that one.
Mind you they weren't that big.
I found probates aren't that simple, as I discovered when I tied to do it myself so, she had better get a lawyer. A few letters from a lawyer may give her some time to pay. If things are similar to here legal costs for probate shouldn't be that big.
Now if only I would stop getting mail order catalogues in mum's name. ;)
Shug wrote: One of my pals dad's died, ma mates only just found out that his dad had unsecured loans for £20k - is my mates mum liable for the debt, cos the house they own is in both names.
Shug being serious for once!
I work in law (but deal with property law) so I'm not entirely sure about this, but if the house was jointly owned and there's not enough money elsewhere in the estate to pay off the deceased person's debts, there is a chance that the home would have to be sold to cover the debts. The options to avoid a sale depend on whether it was owned as 'tenants in common' or 'joint tenants.'
Tell your mates Mum to contact either the CAB or the national debt helpline asap. And if you need anymore info, I can ask someone at work for you.
This is just my own take on it, but I'd certainly advise going to The Citizen's Advice Bureau asap.
Also, try National Debtline - they're open on a Saturday too and are apparently incredibly helpful. Their website is full of useful information.
My initial reaction was:
It depends what the small print in the loan agreement says. If it's an 'unsecured' loan, it shouldn't be dependent on property, i.e. a house/flat, etc. which can't then be repossessed. That's why it's 'unsecured' - the lending company agrees to lend money not secured on the value of property. If it's secured on property, it's usually referred to as a 'Secured' or 'Homeowner' loan.
Before anything can be seized, a CCJ has to be served against the debtor or person/persons taking on the original debt. The County Court would examine the debtor's incomings/outgoings, NOT what they currently own and make a judgement as to a monthly amount that the person/persons could reasonably afford to repay on a weekly or monthly basis. This may be as little as £5 a month on a £10,000 debt. It's only if someone defaults on the payments for their CCJ that any kind of collection agency could be sent in, as the creditor is bound by the same judgement passed by a court.
They needn't worry about bailiffs for the moment - loan companies use them as a threat to scare people into paying up. It's just another of their very nasty tactics. A court needs to grant a notice of default/seizure (or similar) first and to notify the debtor of the outcome of the application in writing well in advance before any posessions can be seized.
Generally speaking though, these kind of debts should die with the debtor, though the loan company may make a representation in court regarding probate.
If your mate's dad had repayment protection as part of the loan, the insurance covers the whole thing and nothing would be owed as long as he kept his repayments up to date.
Legal advice/legal aid is the best bet anyway, even if just to put your friend's mind and his Mum's at rest. As it's a difficult time anyway, they could make representations to a court/solicitor to delay any kind of hearing due to bereavement.
Hope that helps.
Chris Nash wrote: This is just my own take on it, but I'd certainly advise going to The Citizen's Advice Bureau asap.
Also, try National Debtline They're open on a Saturday too.
My initial reaction was:
It depends what the small print in the loan agreement says. If it's an 'unsecured' loan, it's not dependent on property, i.e. a house/flat, etc. which can't then be reposessed.
Before anything can be seized, a CCJ has to be served against the debtor. The County Court would examine the debtor's incomings/outgoings, NOT what they currently own and make a judgement as to a monthly amount that the person could reasonably afford to repay on a weekly or monthly basis. This may be as little as £5 a month on a £10,000 debt. It's only if someone defaults on the payments for their CCJ that any kind of collection agency could be sent in as the creditor is bound by the same judgement.
They needn't worry about bailiffs for the moment - loan companies use them as a threat to scare people into paying up. It's just another of their nasty tactics. A court needs to give them permission first and to notify the debtor of the outcome of the application in writing well in advance.
Generally speaking though, these kind of debts should die with the debtor, though the loan company may make a representation in court regarding probate.
If your mate's dad had repayment protection as part of the loan, the insurance covers the whole thing.
Legal advice/legal aid is the best bet anyway, even if just to put your friend's mind and his Mum's at rest. As it's a difficult time anyway, they could make representations to a court/solicitor to delay any kind of hearing due to bereavement.
Hope that helps.
Kind of what I said. The CAB/ National debtline will give the best advice. The debtor is the person to whom the loan was made and as they are deceased, they can't be taken to court. Teh claim will have to be against the estate. If the loan was sold without insurance, the lender should take reposnsibility for this. Please tell me that it is a reputable mainstream lender and not one of the loan firms that advertise on the TV. The crux of the matter will be based on the fact that the wife wasn't aware of this loan. The CAB/ national debtline can argue this case.
It is my firm belief that a financial institution making a loan is making a business decision and if it goes wrong then they should write it off as such. Unfortunately, as I know all too well, they don't see it that way.
If its a High Street bank, and in the case of unsecured loans only, they would normally write it off, as the cost of pursuing it through the courts etc, and the potential adverse publicity it brings. All these institutions are themselves insured against such losses anyway.
However, the current economic climate may have brought about a new policy, and in any case, they will terrorise with letters of legal threat etc first, prior to writing anything off. The worst potential scenario is that they sell the debt on (normally at 5-15% of the remaining balance), to a specialist company, who will do all the dirty stuff, and not in the banks name.
Get advice from the above mentioned institutions. Its all in the small print in many cases.
sorry shug but i reckon that it will form part of the estate, when someone dies all debts are added to this, any left over balance once they are paid off is what forms the estate.
however you shouldnt be getting advice from an internet forum, but doing what people have asked. you should be bale to get some free legal advice anyway, but CAB is your first point of call here - if you haven't got a copy of the loan agreement get one from the lender & take it with you.
