Should an unpaid family loan be deducted from my brother's inheritance?

[Triflemuncher]

Hi everyone.

Mum passed away semi- unexpectedly. A horrible sad time for us all.

my brother and I have started the process of unpicking her finances. About a year before mum died she lent my brother 10k. At the time of her death there was about £8k left to pay. There was no written loan agreement which I can understand to some degree.

my view is the 8k remaining debt needs to be deducted from brothers share of mums estate. He disagrees and thinks that it was an Informal arrangement between him and mum with no terms and conditions, or any link to her estate.

Where do we stand on this? Is there anything I can do or is this £8k just written off?

If your mother made a will, it should be honoured. So probably £8k written off.

Sorry to read of your loss, hope in time you can remember all the good times with your mother.

Unless he says sure - then I wouldn’t pursue it because without a shred of evidence - you stand no chance

Basically it really doesn’t matter what you say or do. The ball is in his court and if he’s saying he’s not going to - then you have to accept that.

I am sure your mum wouldn’t want you falling out over this

As a mum I would hope my daughter would fight her corner!

Officially you have to write it off. But I would make clear to him that I thought his position was dishonourable and would have made DM very sad.

I think the right thing for your brother to do is to deduct the money but don't think there is anything you can do about it if he chooses not to. Has your Mum helped you in other ways? My MIL passed away this year and over the years has given my BIL loads of extra money but we just wrote it off as she helped up in lots of other ways and she wouldn't want us fighting about it.

Who’s the executor?

Im sorry for your loss

I don't know if there's anything legally you can do however, I would think really carefully about causing a fallout with your brother for the sake of 8k especially when you're in the depths of grief

This is the legal position - your brother should repay the money to the estate, which becomes part of the estate (so he might get some back.)

However, that's not a good way to handle it. It depends on the size of the estate, your relative financial positions, how much you want to maintain a good relationship and how magnanimous you are. Personally, I'd write it off as a gesture of goodwill.

@Triflemuncherhe should 100% pay it back. He’s a sheister for trying to save himself £8k as a result of his mother dying.

In the interest of maintaining good relations with my sibling I would write it off.

Was the gift/loan made before or after the date of the Will?

I'm likely to end up in a similar situation with me owing the money, and I would absolutely take it off my inheritance. Your brother is behaving badly but without evidence you can't force him.

Is he broke? Is the inheritance fairly small? I'm wondering why 8k is such a big deal to him given he is inheriting.

I think it depends on the total value of the estate if the 8k is a small % in the grand scheme of things, I'd leave it for the sake of your mother's memory but if itsa significant chunk of the money then I'd imagine your mum would want things to be fairer.

If it was a loan (and the fact it was being repaid shows it was) then it is a debt to the estate and should be paid back.

So if the 2 of you have an equal split then the maths is like this.
Value of estate = £100k + 8k debt = 108k
Divide in 2 = 54k each.
So you get 54k from the estate and he gets 46k (plus the loan written off).

Sorry for your loss.

Your brother is being awful about it isn’t he.

If I could legally force the issue I would.

I think he’s wrong really, he should offer to pay back what he owed. Not offering in that situation speaks volumes about what kind of person someone is. Whether you pursue it or not though depends on how much the estate is worth, what your relationship with your brother is like and what you want it to be afterwards. I can understand writing it off to keep the peace but you wouldn’t be wrong for letting him know you’re disappointed.

Very sorry for your loss.

Morally speaking, I think you should both try to do whatever you think your mom would have wanted - I assume as her death was unexpected she didn't state her wishes regarding this? I suppose if she had felt very strongly about the plan being taken into consideration she would have written this into the will.

Given that she hasn't, I suppose you have to assume that she wanted you to inherit equal amounts, loan or no loan (I assume that's what the will says? If there is one?).

Unless she had a conversation with either of you to say she would like it to be taken into consideration? If so, the right thing to do would be to honour her wishes, but you would be relying on your brother to be willing to do this.

It may be best just to forget about it, rather than getting into a conflict at this difficult time. Again, I am so sorry for your loss. These things are never easy.

What? No you don’t - officially the debt should be repaid back to the estate and distributed back to the beneficiaries (presumably 4k to each OP and her brother).

But whether you can prove that that is in fact the legal position is more difficult, and whether it would cost more in legal fees are different questions.

So in effect he's saying that he thinks he should get 8k more than you from your mum's death. Has he said why he thinks that is fair? Formal/informal is neither here nor there, you both know it was a loan, and as another poster has said, the fact that he'd acknowledged it by paying some of it back does actually give you a leg to stand on.
I'd tell him that I'm really disappointed that he's trying to enrich himself at your expense.
Was there a will, and if so, are you both executors?

If you want to try and reclaim the remaining 8k for the estate then you need to do a couple of things first. Try to get something from your brother in writing to confirm the amount still owed, email or whatsapp is fine. So you could message him, as you borrowed 10k and have only paid back 2k, you owe the estate 8k. It doesn't matter whether he argues that he doesn't, the aim is to get the transaction confirmed.

Then you need to ask the executor to include the 8k as an outstanding loan. Who is the executor?

When my mother died I’d just finished paying back a large sum of money. My sister had not. It wouldn’t have occurred to be for one fleeting second to deduct anything!

Your brother is being a shit. Of course he owes the estate 8k. I would tell him what expect him to do.

I wouldn’t want her wasting her energy and time if she knew that my son wasn’t going to change his mind. I wouldn’t want my money to cause a rupture

how much is this £8k in the context of the estate @Triflemuncher ?

The Op has
He disagrees