Active discussions

Meet the Other Phone. Child-safe in minutes.

Meet the Other Phone.
Child-safe in minutes.

Buy now

Please or to access all these features

Talk
AIBU?

Share your dilemmas and get honest opinions from other Mumsnetters.

Original poster

Do I get more money?

304 replies

bridgetjonesmassivepants · 14/01/2018 10:31

Can't work this out. I've changed a few details so it's not very identifiable and posting here for traffic.

Recently my mum died and my sister and I were left with £150,000 between us. (Bungalow had already been sold as mum had just moved into a nursing home) Will says everything is split between us two. But, my sister had a loan for £8000 from mum when she sold the bungalow to buy a car, she had only paid back £1000 of this when mum died.

Question is, how is the £150,000 split taking into account that sister has got an extra £7000?

OP posts:
LyraPotter · 14/01/2018 15:21

Given how contradictory all of the responses on here are I would suggest MN isn't the place to get proper advice. I'm not an inheritance lawyer but know that the law in Scotland provides that where one child of the deceased is gifted or loaned a sum of money within a certain period prior to death, they inherit less as a result. You need to speak to a lawyer if you don't know yourself.

alphajuliet123 · 14/01/2018 15:35

I agree that the money should be equal and I'm sure your sister will too. I would tell her you have taken advice and that the £7k forms part of the estate (which is true, I used to do probate for a law firm) and ask how she'd prefer to sort it. When will you be speaking to her?

GabriellaMontez · 14/01/2018 15:48

Bizarre.

So all the people here who wouldn't mention the debt, presumably wouldn't plan to pay that amount back if they had the loan ?

Even though there was a clear expectation between the sister and mum it would be repaid? And probably a legal obligation. That is grubby and opportunist.

Sorry for your loss. And that you have to deal with other things at this difficult time. It certainly sounds like your mum and sister expected the loan to be paid back. I don't see why her death would change this.

goose1964 · 14/01/2018 15:53

My dad lent my sister a considerable sum when her husband was made bankrupt ( not his fault the company he contracted for delayed paying him so he couldn't pay his suppliers) His will has been amended an I have the same amount as a change on his house so we're not put in the same place as you so the amount left to you would be the outstanding loan plus thalf of the remainder

RedForFilth · 14/01/2018 16:02

I don't know! If I was the sister I'd offer 3.5k. But if I were you I wouldn't mention it. 75k is loads of money, I wouldn't potentially risk a relationship for 3.5k especially as emotions are running high. She really should offer though!

Firesuit · 14/01/2018 16:38

If I were executor it wouldn't even occur to me that this is an issue. "The estate" is all assets minus all debts, the loan owed by the sister is an asset of the estate. So if other assets are 150K and the sister owes 7K, the estate is 157K, OP gets 78.5K cash and sister gets 78.5 K consisting of 71.5K cash + 7K debt written off. 78.5K cash to to OP plus 71.5K cash to sister = 150K total.

The only caveat is that if the sister didn't agree, I would offer to go on a joint visit to get a solicitor to confirm who was right.

Topazmortmain666 · 14/01/2018 16:43

Estate is actually worth 157k

So you each get 78.5k

Absolutely this. It’s basically the law as there was clearly an acknowledged debt (I work in this area)

Firesuit · 14/01/2018 16:45

I see the second post in the thread said exactly the same as me, far more concisely. Sorry everyone!

FluffyWuffy100 · 14/01/2018 16:47

Exactly as @Firesuit days.

Some people are slightly dim about their adding up... it isn’t a 3.5k difference. You 3.5k lot would be ace to go out for dinner with when it comes to bill splitting!

Bearbehind · 14/01/2018 16:50

fluffy if you are going to insult people at least get your facts right.

The difference between what the OP would get if excluding the loan from the estate (£75k) and including the loan in the estate (£78.5k) is £3.5k.

Lloyd45 · 14/01/2018 16:58

Is it worth falling out over £7k? Would your mum want you arguing over money, leave it, enjoy your inheritance and have lovely memories of your mum

ilovekitkats · 14/01/2018 17:49

fluffy, they are due £3.5K each of the £7K that the sister owes. So the sister gets £3.5K less than OP because she already has that £3.5K.

As already pointed out

150K estate
7K owed by sister
157K estate - split 50/50 = 78.5K each

Sister A - £78.5K
Sister B - £71.5K
Total payout - £150K as per the sum in the bank account, sister A receives £7K more than sister B. HOWEVER:

In available cash terms, they were each due £75K, so sister A gets £3.5K more, and Sister B gets £3.5K less as she owes that to the estate.

In total Sister A has £78.5K, and Sister B has £71.5K plus earlier £7K, so each sister has £78.5K in total now!

Grilledaubergines · 14/01/2018 18:00

Oh dear, Fluffy . You need to be correct in your calculations if you're to accuse others of getting it wrong.

ivykaty44 · 14/01/2018 18:04

Surely your sister would repay the debt to the estate and you then get a share of the inheritance?

Anyone that’s borrowed money with a repayment plan would know they have to pay that money back and not fiddle their own kin

Grilledaubergines · 14/01/2018 18:10

Ivy but that would require the sister having the £7k available to her and if she borrowed money in the first place, she probably won't have the lump sum.

Although actually the point you make may help those struggling y understand the £3.500 figure.

So, ignoring the loan value £7k); £150, 000 gets split 50/50. Each party gets £75k.

Sister then puts her owed money of £7k back into the pot. It gets split 50/50. Therefore £3,500 each. Sister has repaid her debt from her share meaning OP gets £3,500 and because sister has paid the debt back , so does she.

Obviously I know this isn't how it is distributed but is for the purposes to explaining the division.

Bearbehind · 14/01/2018 18:15

TBH I think the OP has jumped the gun a bit with this post. The original post might have been driven by the motivation of the '14 year old' OP who was afraid of missing out but the end result is OP is now aware the £7k should be included in the estate so to do anything else is a dereliction of her duty as executor.

If the loan had actually been a gift more than 7 years ago then the sister would ultimately have ended up with £7k overall than the OP but, as it stands, the £7k should be split between the sisters.

The moral conundrum over the £3.5k difference if the latter had been the case is interesting but pointless in this situation.

ivykaty44 · 14/01/2018 18:21

Probate can take time - the sister will of course be continuing to repay the loan each month until probate is finished

Depending on repayment plan agreement and, it’s not unheard of for probate to take 12 months - there maybe more money repaid

Until then I’m sure the sister has integrity which will lead to to deal with this situation in the most honest method

Poppyfields21 · 14/01/2018 18:34

Yep listen to @firesuit and please ignore all the nasty posters saying you’re awful for only caring about money. You’re being responsible and trying to accurately do your duty as executor of the will. I’m sure you’re having a difficult time dealing with all of this and these comments won’t he helping! Proof of the loan will be in bank statements (initial payment of £8k and then £1k worth of transfers since then) which proves the existence of the loan, and the fact it wasn’t a gift. You are legally obliged to take the loan in to account and your sister will understand this I am sure. In the vein that you shouldn’t fall out over £7/3.5k, I know I personally would not wish to rip off my sibling for that amount purely because our parent died and as such would be keen for it to be taken in to account in the process, were I in your sisters position. Best of luck OP

ciele · 14/01/2018 18:40

I’m a mum of two daughters. If it was me I would want the loan knocked off your sister’s inheritance.
I always try to treat my girls exactly the same and this is what I would consider to be fair.
Why should one daughter be getting less?
And the sums they inherit wouldn’t matter at all. It’s the principle and the way your mum treated you in the past which is important.

burnoutbabe · 14/01/2018 19:18

There is a middle option, if you wanted

You MUST declare the loan for probate/IHT purposes

but you could do a deed of variation to alter the shares so you both get the same and the loan is forgiven. That is totally up to you of course. But is one valid way of doing things.

SingingSeuss · 14/01/2018 19:25

Sorry for your loss. Unless the will specifies that your sisters loan must be paid back using inheritance money then the inheritance should be split half each as your DM requested, so £75k each.

TeenTimesTwo · 14/01/2018 19:29

but you could do a deed of variation to alter the shares so you both get the same and the loan is forgiven. That is totally up to you of course. But is one valid way of doing things.

You really wouldn't need to do a deed of variation and the cost that would entail. The OP could just give her sister 3.5k if she wanted to, no issues.

As a matter of interest, for other posters, if you and your sibling both had say 60k in savings, would you gift your sibling 3.5k for no good reason?

RedastheRose · 14/01/2018 20:01

Sorry but as Executor you have to do this properly. You have a duty to collect in any debts due to the Estate and this loan is one of them. As pp have said the Estate is the value of the house sale plus the debts owed, less costs of Probate, Funeral and any other debts. You then have the amount of the balance of the Estate divide by two which shows how much you each should have you then deduct the loan repayment from your sisters 50% share to repay the debt.

Do it on a spreadsheet as you will need to show that you did everything properly. You then send a copy of the Spreadsheet to your sister so she can provide the source of funds information to her bank when you credit her bank account with her share.

KERALA1 · 14/01/2018 20:05

Singing that is incorrect. Red is right, the default position if the will is silent is that executors are obliged to collect in loans, whoever to, which should be paid back to the estate before it is then distributed.

Wallywobbles · 14/01/2018 20:10

Thats the way it worked for us. We got equal shares minus outstanding loans.