Hi - I wonder if anybody has been in this unusual position or is able to offer any advice please?
My mother passed away leaving no will and large amounts of unpaid loans (we had absolutely no idea that she had these loans, and there was certainly nothing to show for them). About £16k in total.
A fantastic solicitor helped us to unravel it all and basically all the companies to whom she owed money settled for a tiny amount from her meagre savings.
Nearly two years later and I've received a letter from her main source of loans (a high street bank) saying that there is PPI payable to me (as her executor) as she was repeatedly mis-sold insurance products over many years. It's nearly £10k .
Am I really entitled to this money, or should it go back to the companies that she borrowed from?
I would ask the solicitor. Usually I would guess that any unpaid creditors have first claim on any money, but if they agreed to whatever they were paid as a final settlement, then perhaps it is your money. Definitely get legal advice though - this stuff can be a total minefield amd you don't want to make the wrong decision and hsve it bit you in the arse later.
For the benefit of anyone in a similar situation, it's generally advised that if you believe someone's estate to be insolvent, you decline to administer the estate. To be the executor/administrator is a bunch of work, with no upside to anyone except the creditors, and with the risk that if you do something wrong, the creditors may be able to sue YOU for (some of) what's owed to them.
That was the advice I was given by MN when mil died insolvent a few years ago. That advice was worth it's weight in gold. The bank tried to make dh sign papers where he would have been taking legal responsibility for anything the bank paid and thanks to that advice I knew what to look out for and how to respond. I had companies try to refund money to us, which I refused to accept and even a couple of years later I had her credit card company phone and try to get payment, despite having told them that there was no money. It was a really awful time. Dh was in no position to deal with it so I did. I am really grateful to the posters on mn for all their advice.
Even now I wonder what the credit card companies and car finance people were thinking when they allowed by mil, who was mid 70's, with no assets to just borrow seemingly limitless amounts of money!
Avoiding your MIL's situ and the subsequent anxiety it brings to the bereaved sounds almost exactly like the mess we were in 2 years ago. I even had a minor panic attack when I went into the loft to get out the 'files of doom' before ringing the solicitor.
We had no idea mum was going to die, it was a complete shock, and the more DH and I discovered about her financial position the more angry, sad and upset we became. She lived in a housing association flat and had no income other than her state pension. The solicitor suggested thinking about pursuing the loan companies for irresponsible lending but we were past it by then. The loan companies made what was already a very difficult and traumatic time even worse