Inheritance when a sibling owes money to deceased parent

[JustSaltPlease]

Hi

My dad has sadly passed away a few weeks ago. He had around 20k in the bank which is being shared between the 4 children. No will.

However, one brother owed him 9k, and the other 2.5k.

What is the best way here. Surely what they owe should be considered dad's estate, and the whole amounts divided by 4. Siblings will still owe the other recipients then but this does mean the 2 brothers walk away without any cash. Am I making sense?

The OP has to apply for letters of administration before she can deal with an estate.

@YabaJaba
Thankyou , but I can't see we're op has said she is admitting the estate or said who is .

as I understand it, the OP

Yes, this is almost exactly what my siblings and I did when my mum died. Both of my brothers had borrowed substantial sums from her so they ended up "owing" me money and ending up with far less themselves. The way we all, amicably, viewed it was that they had already had a portion of their own inheritance up front whereas I had not, so we put it right when sharing what was due to whom. I haven't got a clue whether it could have been enforced legally (I suspect not) but luckily my brothers and I have a good relationship and solved it this way.

I'm not 100% certain but I think very small estates like this don't have to go to probate. My db died this year and his cash assets wouldn't have even paid for his funeral but he did own a small terraced house - our parents had paid off his mortgage (unbeknownst to me but I'd have been fine with it) when it was going to be repossessed so it did need to go for probate. Probate was granted very quickly.

Express your concerns to the executor. I assume if there was no will it’s a solicitor?

Thanks for that - was only going on my past experiences. In this case without a Will I am interested to find out if it does or not.

Sucks to be sorting this out. Try not to fall out over money even though it’s hard.

Morally your brothers should offer to repay the loans to his estate, but only you know what their characters and morals are. If I owed money to a parent who died I wouldn’t even need to be asked, I would feel obliged to repay it.

It depends on where the money is held and their limit, whether they will release funds without a grant of probate.

In my dad's case, his bank released his money prior to probate (which was needed as there was also property) as it was under their limit, which was 50k.

I'd deduct what they owe from there share tbh, and split between the others. You'll never get paid, and will end up causing resentment. Saying that no will, no loan agreement they can claim gift and then it's just a 4-way split as is and debts nullified.

My uncle owed my and other uncle money and they made him settle debt owed to THEM before they have money and that worked otherwise the we're going to use the fund to clear his debt to them and give him the balance.

Families and money are so so tricky. Yikes!

Make sure you document everything people, we don't know how long we're here and we want wishes met it needs to be formal even if we don't like it talk money with family! Lessons.

There is proof that the money was loaned. Executors of estates, will or no will, must obey the law relating to wills and estates and debts can't just be nullified to keep the family sweet!

small estates don't have to go to actual probate bur every estate needs to go through some kind of official process and this is often called "probate" the smaller the estate, the simpler the process but something has to happen and someone has to take official responsibility for doing it. In my grandmother's case, she was actually owed pension as she had been ill for several weeks and hadn't been able to get to the post office to collect it. This is some years ago of course, now it would just go into her bank account.

I think, given the debtors behaviour, that ship has sailed.

I absolutely agree without a doubt that you take the money owed by the siblings from their amounts. As suggested the one sibling who owed £9k carries on paying the remaining balance to siblings.

Anything less is completely wrong.

YANBU. Having said that, you should contact a solicitor to get proper advice rather than asking on here, where you mostly get people's opinions. Some solicitors will have a discussion with you about all this before you commit and will give you a quote for what they'd charge to deal with the estate. We found it wasn't as expensive as we thought it would be.

The solicitor had the difficult conversations when needed. It removed people's own opinions from the discussion and everything was formalised.

This isn't about people's opinions or what they see as 'worth it' or not. Nor is it about what people think is 'morally right'. The rules are strict around dealing with the estate of a deceased person.

Before my brother died my dm told me that they had used their life savings to pay off his mortgage as his home was going to be repossessed. This had happened a few years earlier but I hadn't been aware though I did know my db generally stuck his head in the sand when he couldn't pay something eg council tax, water rates etc and they often went to court.
It was pretty obvious that dm wanted me to reimburse them after he died from his house sale ( his only asset) if he left me his estate. I just told him to leave them his estate and nothing for me. I'd so much rather I still had him than any amount of money.

I love this - you can’t owe money to a dead person. If only the world worked like that 😂

Blimey, they’ve got a nerve 🙄

Following as I may be in this position in the future when dm does dsis has borrowed tens of thousands from dm not sure if it’s documented or not but we both have recording that they are loans and dsister offering to draw up a legal agreement saying they will be taken off her share of the inheritance
probably won’t need to refer back to the advice given on here as
the day after she blocked me on everything then has proceeded to remove me as poa done equity release on dm house I only found out by the land register and dm is unsure if she has changed her will to remove me police office of public guardian and social services are involved

I hope you resolve it amicable with your family op it is so upsetting when siblings fall out over inheritance

They are taking the piss and will stop paying after the assets are shared. As others have said get your solicitor involved.

At least with this proposal they have acknowledged the debt and cannot later claim they don’t owe any money it that it was a gift.

You owe it to the estate of the deceased person.

Interestingly, after reading this thread I was talking to my sister who had just visited a lawyer about her will. I have borrowed quite a large sum of money from my sister. The lawyer was very clear that the money I have borrowed will have to be repaid to the her estate immediately on the death of my sister.

Small update. The brother who owes the larger sum has stated to other brother that it would be cleaner to just offset the debt they owe from their "share" and repay remainder to us. Other brother reluctant as he is "skint". He doesn't seem to understand that he would be borrowing from my inheritance.

There is no executor, but as it happens my brother (the one being difficult) is a wills and probate solicitor.

Maybe I am missing something but I don't think you can have an estate without an executor can you?

Edited: I guess I mean executor/administrator as I think they have different names if someone is intestate possibly.