Probate - no will, and and dealing with outstanding mortgages etc

[ISpentTheDayInBed]

Not sure if this is the right forum to post on, but here goes!

My step daughters mum died very suddenly 6 months ago. DSD is grown up and has a young family. DSD is finding it very difficult dealing with her Mum's affairs. She has asked my DH and me for help, but we don't really have much idea where to start.

As far as I am aware she hasn't applied for probate. Anyone got any idea how to do this and how long it takes? DSD is the only child of her DM and would be her only beneficiary.

Second question. DSDs mum has a mortage on her house. This is through a sub prime lender. They have suspended payments for 12 months, but then DSD has no idea what happens. The amount owing is very small in comparison to the price the property would bring. If the house had to be sold, would DSD get the difference between sale price and amount owing?

my DH says DSD is desperate for us to help now and I don't have a problem with that. I would be really grateful for some pointers on where to start.

For info, DSD does have a partner, but he is feckless and not got a clue about money, but don't want to go into that.

Op, Probate only applies where there is a will.

If there is no will, then your DSD needs to apply for letters of administration, which gives her the rights to administer the estate as per an executor of a will.

It is similar to probate, but has different forms to fill in. I would suggest that those forms are your first port of call.

Do you have any idea of the estate value (house, less mortgage, plus any cash).

If it is above 425k, then inheritance tax has to be paid, and whoever administers the estate has to pay an estimated amount of IHT within 6months of death. So that could already be overdue. Again, there are forms to fill in and your DSD needs house valuations (at least 2, suggest 3, for IHT and/or administration, and an estimate of amount owed on mortgage).

She should be starting the process of selling the house (it can go on market and an offer accepted prior to LoA being received but she will need LoA before Exchange). My mums house sold before we had probate, but we were in the process of getting it and had it well before we exchanged)

Once it has sold, she will then use the proceeds to clear the mortgage before adding the remainder into the estate, to be 'distributed' to beneficiaries. In this case, that will be her only.

Kath has explained it well.

Such a sad situation and one of the many reasons everyone should have a will. Never assume anything, without a will whatever you wanted whilst alive doesn't matter.

Probate is a much used phrase which tends to confuse people.
Kath is right, it's technically called grant of representation/administration. It's just a document that allows you to deal with the estate. You can get a solicitor to do it for you, but it's honestly not that difficult. I estimated everything and had it back within 3 weeks.

www.gov.uk/wills-probate-inheritance/applying-for-a-grant-of-representation

I've just checked the gov.co.uk site and they call it a grant of representation, not letters of administration. It also looks like it may be the same form as for probate. Sorry for the confusion, but that gov.co.uk website is probably where to start.

Probate for my mum took about 4 wks from application to getting the grant, I've no idea if grant of representation would be similar. I suspect it may be longer as they probably have to confirm she is the next of kin/only beneficiary. (A friend of mine has just lost her dad, no will, only child, and she was wondering how they prove she is an only child).

Veuveo - cross posted, I should have checked the website before posting!!

Afaik it's granted to the first applicant.
There's space to name other possible interested parties,
Ime they don't really confirm a lot!

Uplighter, my thoughts exactly.

I couldn't believe my friend's dad didn't have one, esp as her mum - who died about 10yrs ago - didn't either, and my friend used to work in a probate dept! But her dad was stubborn, am sure she tried to get him to do one.

My Dc got an inheritence left to them 3yrs ago, DS got his just after his 18th, and we immediately sorted him a basic will leaving it to DD, otherwise his cousins. We will do same for Dd when she turns 18 in the summer. We don't need their money, so would prefer it to be left to each other or cousins.

One driver for DS will was that if we all died together, some of his money would have gone to my DM, who was terminally ill, then onto my DB who we all hate (with good reason). DM is not with us any more, so that route is now closed, but even so, a will makes things easier.

Thanks everyone. Really helpful. The estate if probably not more than 200k, and there is just the one daughter.

kath6144 thanks for your very helpful post. My DSD would like to move into the house if possible, but it is good to know there are options available to her.

Just to add that if you decide to do it yourself the helpline is very helpful. They takes me through the form and it was quite straightforward in the end

In regards to mortgage. Lender will expect mortgage redeemed either in cash/another mortgage or by sale of house.

If it isn't they can take recovery action through courts, it will take time but it will cost money.

If they recover and sell themselves they will take remaining mortgage amount and costs then the rest of money would go to the estate.

Any life insurance or any cover that is making a payout for the mortgage? If unsure checking direct debits that were set up on back account can help.

If dsd will need to mortgage to redeem the current one then she should speak to a whole of market broker who can help look for suitable products.

Remember even though they have suspended payments they might not have stoped interest charging which will compound each month.

Thanks everyone. DH done a bit of investigating today and things are worse than anticipated as there are a few debts to pay off and also the utilities. Nothing been sorted out. They are going to have to get a big loan to be able to settle this is they want to keep the house I guess.

Could I suggest your DSD or you go to www.moneysavingexpert.com as there is a really good forum there under deaths which will give all the information that is needed with a step plan. I used this to help my husband with his mums estate a few years ago. Also gives help in id3ntifying bank accounts that might exist. We found one for his deceased dad back to 1957!