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?

This makes a massive difference.

Chances are it will cause fall out. However the fairest way is for their debt to be taken into account.

You can argue it both ways, but ultimately you won’t know unless you get legal advice. I wouldn’t bother for such small amounts. It’s way less than a year’s salary. Just go along with the consensus among your siblings. I’m currently owed an inheritance that’s worth 7 years of my salary, and we’re trying to avoid lawyers and keep things amicable within the family.

Agree legally the debt needs to be considered but only if there is any actual proof.. otherwise I don’t see how it can be included.

My brothers have suggested that everyone gets am equal share but they continue their loan repayments into a "pot" which is divvied up when repaid. This doesn't really work for me.

I'm getting angry thinking about how much more each of them had.

Do you have a solicitor working on this? If not it might be time.

you need legal advice. Because there is no will, someone will need to be appointed as executive. Suggest a solicitor. It will cost money but they can be the bad guys. Just tell them you want it enforced.

It Should be paid back to the estate or taken out of their share but contract law is weird when it comes to family. The legal system doesnt like to get involved in family matters. I studied contract law (but not a lawyer) and i know you need evidence that you intented to make legal relations. This normally is with a written contract but not always with family. It is very hard to prove the legal relationship between two family members. Let an estate lawyer deal with this unless as siblings you can reach an agreement.

A solicitor is going to cost more than the 2.8K extra the OP wants. I really can't believe she's willing to fall out with her siblings over such a small amount especially if they have agreed to continue with the repayments.

No
They can't do that, they are being ridiculous

Tell them to grow up, they repay what they owe now via getting less inheritance
The end

This 100%
Just drop it.
If the money means so much to you, focus your energy on increasing your qualifications and long term earnings.

I think you need to just accept this isn’t going to go the way you wanted OP. Most likely this would just he written off but as there is a signed repayment plan etc at best your siblings will be right. The will will be followed and money divided accordingly, they will continue the repayments and then that money split down the line- that’s your absolute best case scenario.

No solicitor is going to say you can differ from the will and no solicitor is going to go against a signed and agreed repayment agreement to say suddenly its all owed now.

Please focus on yourself and getting through this tough time rather than focusing so much on a few £.

It has to go to probate, that will take care of a few thousand £'s

The loans will have to be repaid

Debts paid

Then the balance divide between the NOK

Yes I agree. Brother who had 9k loan should get nothing and continue to pay 4K back to the remaining three siblings. Brother with 2k loan gets 2k less than the remaining two. So one gets nothing, one gets approx 5k the other two get 7k.

Probate won't cost thousands unless you get a lawyer in. About 350 quid in fees and postage.

Nope. If you agree to this you’ll never see those “repayments” I guarantee.

If you’ve not already done so write to the executors setting out details of the loan and enclosing relevant paperwork and saying that you think the debts should be dealt with as part of the estate.

There is no will
That actually means the Op is right.
The inheritance is split with the money owed being accounted for.
Do not stand for this idea of a "pot" @JustSaltPlease utter nonsense on their behalf.
Apply for probate, all debts paid out, funeral etc
What's left/ owed accounted for and then divided accordingly.

I can't believe they have said they will pay it back into a " pot"
Completely unnecessary complication and CFery

I think that if they want to keep paying according to the written fixed schedule then that's probably the right outcome and the best you're going to get .

But they shouldn't pay it into a pot that's then split at the end - they should both pay three-quarters of the payments which are due in the agreement directly to their siblings each month (or whenever).

So if they each were meant to be paying back one hundred pounds a month to your dad then instead brother A pays 25 quid each to brothers B and C and OP, and brother B pays 25 quid each to brothers A, C and the OP. They keep the remaining 25 quid for themselves because they've inherited a share of their own debt.

They don't get to decide this.

They owe the money to the deceased estate.
Debts / what's owed are dealt with and then the money is distributed.

I've never seen any type of arrangement like this, it's very cheeky, immature and selfish

Cake and eat it springs to mind

Baffled as ever by the people who come onto Legal Matters, where an OP is asking for help and advice, to confidently spout bollocks as if it were fact. If a small tradesman had just tiled their bathroom and been run over and killed on their way home from the last day, do you think they'd refuse to pay the invoice? I guess so.

Yes that’s how it should happen but if there’s no will and no proper notification of those loans, it’s unlikely.

Who is administrating your father’s estate? I get that there was no will but, legally, there has to be someone who makes the decisions (if the estate had debts, or there was other money owing to the estate, or just reclaiming council tax and organising and paying for the funeral). You can’t just divvy it out between you one weekend. The administrator makes the decision and if the loans were documented will take that into account.

No it doesnt

But just as debt isn't written off because the person you owe it dies then if the debt has a scheduled repayment plan then death doesn't cancel that agreement either.

In addition of course there's the practical issue that the brothers are happy with scheduled repayments but not with instant deduction from estate.

The estate and all financial affairs are wound up and finalised via probate, then the money is distributed.
You can't decide to keep repayments going, I can't believe anyone would actually think this

When my DM died, I had borrowed a small amount from her that I was paying back monthly. Because of the regular payments, the loan was considered part of her estate and was thus liable to death duties. (Neither of my parents made a will - it would have been much better for us had they done so.) The duty was paid by the estate, but the outstanding loan was (rightly) taken off my share of the inheritance. My brother also had a small informal loan - that, too was take into account, so that we all ended up with the same amount of money, whether we’d had it before she died or after. I can see it might be a problem, though, when the debt is more than the inheritance an individual is due to receive.

It's not convenient, but if they've agreed to pay over a period of X then that agreement still holds.

And it would be trivially simple to write up an agreement which transfers 3/4 of the debt from the OP's father to the siblings in order to tidy up probate paperwork.