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Having to Pay the Debt of a Deceased Parent?

(66 Posts)
absolutelyclueless Mon 21-Nov-16 19:11:08

Hello All,

I hope you can give me some advice for a good friend, whose father sadly died in August. The debt is for an adjustable bed that her Dad took credit out for back in 2013. My friend thinks the debt is about £6,000; she knows he was paying £103 a month and had 36 months to go when he became very ill and was moved into a hospice.

The deceased didn't own his own property, and money from his bank account was split between my friend and her 2 siblings (there was not enough in the account to to cover this debt, incidently).

My question is, is my friend liable for this debt? Her father was under the impression it would effectively die with him, but she has today received a letter saying she will hear from the company's solicitor within 10 days regarding the outstanding amount.

Any advice gratefully received; obviously this is adding to the upset of a recently bereaved family.

OohhThatsMe Mon 21-Nov-16 19:12:34

All debts should have been paid out of his bank account before any sharing went on. If the bank account shows, eg, £200 in there, then that has to go on paying towards his debt.

greenfolder Mon 21-Nov-16 19:15:50

Debts only die in as much as the estate pays the funeral expenses first, then all other debts. If there is not enough cash to pay the debts they can't be recovered. It would be sensible for you and siblings to pay the amount you got towards the debt.

Potatoooooo Mon 21-Nov-16 19:18:47

From what I have read, all debts should be wiped off when the person becomes deceased.
How can they roll a debt over to someone else when it was never them that took out the credit? It wouldn't even make sense.

Sunseed Mon 21-Nov-16 19:19:32

Where is the bed? Would the company still technically own it until it was fully paid for?

YesILikeItToo Mon 21-Nov-16 19:33:11

Potatoooo Where did you read that?! Even the Sunday Post could do you a better analysis - no 'rolling over' is involved.

absolutelyclueless Mon 21-Nov-16 19:37:21

Thank you everyone for your replies.

I've just checked with my friend for clarification. No direct debits were active when the account was closed, because when her father was transferred to the hospice my friend rang the company to notify them and they said they'd freeze the account until June. Friend heard no more until today, and neither her nor her Dad cancelled the monthly direct debits, so she assumed they did. With regard to the bed itself, the bed company told her to do whatever she wanted with the bed as the loan was arranged through a third party agency that the bed company themselves arranged. As her father was living in a council flat at the time he moved into the hospice, my friend had to clear the flat out completely, and so gave the bed away.

OllyBJolly Mon 21-Nov-16 19:37:44

The estate has to pay out for all obligations before the beneficiaries get anything. (and if there's nothing left they get nothing). It's not true the debt "dies" with you.

Did the executor know about the debt - or have the siblings just emptied the bank account (albeit in good faith)?

bluelilies Mon 21-Nov-16 19:43:13

I think whoever was the executor of the will should have paid the debt (or as much as possible of it) from the bank account, and not distributed the cash until they'd done that. How did your friend and her siblings get hold of the cash in the bank account?

absolutelyclueless Mon 21-Nov-16 19:43:39

Friend did know about the debt, Olly, as she contacted them to inform them he'd moved to the hospice, and was told the account would be frozen until June. That was the last she heard, however, and assumed that it had been dealt with.

tribpot Mon 21-Nov-16 19:45:14

From gov.uk: "As the executor or administrator you have a legal responsibility to pay off any debts or outstanding payments before distributing the estate."

FannyWisdom Mon 21-Nov-16 19:47:14

Were all the funeral expenses paid from the estate?
Flowers, notices, headstone?

thatdearoctopus Mon 21-Nov-16 19:48:22

She "gave away" a £6000 bed????? shock

absolutelyclueless Mon 21-Nov-16 19:48:55

Lillies, she was of the understanding that probate didn't need to happen as there was no property or belongings involved, and his benefit payments were stopped once he'd moved into the hospice. As executor, my friend just needed to show them the will and take ID into the bank.

CotswoldStrife Mon 21-Nov-16 19:51:54

The executor is at fault here. Was it your friend? No way should payments have been made if their was a debt. I suspect they'll need to give the money back!

absolutelyclueless Mon 21-Nov-16 19:52:15

Dad had a pre-paid funeral plan that covered the funeral costs. My friend had no choice but to give away the bed, as she had 2 weeks to return the flat keys to the council and so had to clear it out completely.

Thank you for your advice everyone.

dietstartsmonday Mon 21-Nov-16 19:52:47

My dad died leaving debt. This was not paid off as his money didn't fully cover his funeral costs.
In your situation they will be liable for a money taken from bank to be paid towards this debt. How much money did they have?

CotswoldStrife Mon 21-Nov-16 19:53:03

Cross-posted - your friend is the executor and is at fault. She needs to get the money back.

AdelindSchade Mon 21-Nov-16 19:53:11

My father died in a lot of debt. We had to pay it all off from his estate.

absolutelyclueless Mon 21-Nov-16 19:54:41

Cotswold, the problem was though that she didn't realise that there still was a debt. The finance people had cancelled the direct debit, so no one was aware payments still needed to be made.

atticusclaw2 Mon 21-Nov-16 19:55:59

Yes your friend wasn't entitled to anything. The debt had to be discharged first.

She only inherited if there was anything left after all debts and costs were paid.

FannyWisdom Mon 21-Nov-16 19:57:10

Bugger.

Yes they owe it (not the whole amount if the estate had less cash than the settlement)
Ask for a final payment amount from the credit company, maybe ask for copies of the finance agreement and proof the debt incurs the entire interest and doesn't need reducing.
Slow them down.

absolutelyclueless Mon 21-Nov-16 19:57:31

Diet, there was considerably less money in his bank account than the £6000.

bluelilies Mon 21-Nov-16 19:58:00

If your friend was the executor, and she knew about the debt - as you say she did - then I think she is at fault and may have to pay the debt - or at least as much of it as was left in the bank account. I'm still not clear how she physically managed to get hold of the money without probate. Don't banks need to see probate to hand over money?

CotswoldStrife Mon 21-Nov-16 19:59:07

She was aware there was a debt, and it's the executor's job to check these things. She knew it was only suspended until June and should have checked before distributing the estate (maladministration). She needs to seek legal advice ASAP.

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