Paying mortgage and council tax after a bereavement

[MelbourneWay]

Asking for a friend who has a three year old daughter. Her partner passed away recently, it was somewhat unexpected. They had a mortgage together. She is on universal credit getting about £600 per month which comprises the standard allowance and support for one child. She can just about live on that but can't pay the mortgage or council tax at the moment. Mortgage and council tax also come to about £600 per month. Is there any help that she can get for the mortgage and council tax whilst she is waiting for probate?

Has she called the mortgage company and council to explain and ask for a payment holiday or assistance? Council tax often isn’t paid in February and March so that shouldn’t be such a concern right now unless she is behind.

Has she applied for single person discount for council tax? My sil gets part of her council tax paid for her (she's on UC too) I'm not sure if the criteria

Has she called the mortgage company? Sometimes they offer a break period due to financial hardship. They usually have a policy about payments in these circumstances

Assuming there was no life insurance to cover it? If there is a policy get her to call them ASAP that's what my mil had to do.

Also can her UC increase as she is now a single parent and only has one income?

She should contact her local council as she may be entitled to council tax support/reduction. She should also ensure that she is getting the single person discount on her council tax (reduces it by 25%) she can have this as well as the council tax reduction/support

Thank you for the replies. The bereavement happened almost three months ago. The mortgage company has said that she should keep making payments each month, and she has this week received very very nasty letter from council tax demanding immediate payment of the full year'a balance of about £400 or else they will add £435 in charges and issue a summons. She's not really sure where to start.

Your friend can apply for both 25% single person discount ( not means tested) and local council tax relief- which is often available to do online and then just take evidences in

Also advise your friend to talk to citizen advise as there maybe other benefits to claim as widow

MelbourneWay

Tell her to visit offices and talk to council tax about sorting this out

All councils have a ‘benefit’ for the reduction in council tax for low income. Usually called council tax support or council tax reduction.

If your friend goes on her councils website It will show how to apply.

If you don’t make your monthly instalments to council tax and don’t contact them to tell them why the system will automatically cancel the right to pay by instalments and request the full amount owed. If no payments or contact is made the system will automatically issue a court summons.

Get your friend to call the council for them to put a hold on recovery and to reinstate monthly instalments.

She should also ask her council if they have a discretionary fund for ctax.

Her husband should have had life insurance when he got the mortgage... that would be the first thing I'd look into because that will go some way to either pay it off or help.
Council tax I would go in and explain the situation or get hold of CAB. She needs to figure out a payment plan and what she's entitled to in terms of a discount.

A letter like that from council tax suggests she's not been paying at all. Are you sure she notified them of the situation? She most definitely would have been eligible for a single person discount at the least (25% if I remember rightly).

Who is her Mortgage provider? We've been dealing with this a lot recently and it's usually very very unlikely in that circumstance they react in that way. They have specific bereavement centres and helplines designated to deal with situations like that. If they were not informed however it could be an issue. She may well have to pay but I'm surprised they've been so insensitive

I'm assuming there was no life insurance? Unfortunately that's why Mortgage companies suggest getting life and critical illness insurance because they still need to be paid. Is your friend on the Mortgage?

My mil probate took a year to get sorted. Luckily we finally found the life insurance policy which sorted the issue but while it was being located after a brief break from paying she was expected to pay the mortgage.

This may be useful moneyfacts.co.uk/mortgages/guides/what-to-do-about-a-mortgage-if-your-partner-dies/

What has the life insurance company said?

She thinks there was life insurance but does not have the details. She had not called the council but will do. Her concern is how she will pay the mortgage going forward as she does not seem to have found any help that might be available.

Your friend sounds like she is struggling - are you able to support her with some of the admin to sort this out?

• Does she have access to any bank statements or paperwork that might indicate where the life insurance payments go to? That may help her find which company it is with. She may be struggling to look through these personal statements and other effectd so may need help to look.

• Alternatively if they used a broker for the mortgage, they may have got the life insurance via the same broker, who may hold records (depending how long ago it was).

• Can you help her out together a letter to send to mortgage, council tax and maybe utilities too? I'd include a copy of the death certificate and a request for a few months grace - it can't hurt to try.

• She also needs to ensure the DWP know she is now claiming as a single person. She may be able to get help with the mortgage (as a loan secured against the property - but it would tide her over til probate is sorted).

• Did her late DP have an employer? If so they may have been automatically enrolled in an employee pension scheme - many of which pay death in service benefits of several times the annual salary.

Get her to look here: www.gov.uk/bereavement-payment

The mortgage company should know about the life insurance. I know that the poor woman is probably still in shock but she does need to get on top of the paperwork and perhaps this is where you, as her friend, can help her with searched etc.

Read the LINK I put up unfortunately there isn't much help. If there is life insurance then hopefully she can find the paperwork ASAP otherwise she'll have to find a way to pay until probate is sorted. Then the mortgage can be paid off from the estate value unless there isn't enough and she may have to sell up your pay the debt.

It's why life insurance and knowing the details are really key

Call HMRC, they were very helpful
There’s a few things she might be entitled to. There’s a one off bereavement payment, funeral payment
And widows pension/bereavement/parents allowance.

www.gov.uk/browse/benefits/bereavement
She needs to go through bank accounts to look for payments to insurance companies.
Surely new UC claim?

In these circumstances I would be contacting the local newspaper to ask them to run a story on unreasonable mortage company/ council harassing recently bereaved single mother.

If the situation is as you describe you will find that when they contact the bank and council for comment they will immediately offer to freeze the payments while they work with your friend to find a solution. Harassing widows and orphans is not good publicity

Your friend will not get bereavement support payments ( previously widowed parents allowance) unless they were married. There are campaigns going on to get this changed but for now if they weren't married she won't get it.

Mortgages are usually backed up by life assurance. It is to cover just this type of scenario so she needs to start looking around for documents and/or asking the mortgage lender asap.

With regard to the council tax, would she not now qualify as a single occupant on a low income? She needs to call the council quickly too, to ask about this. She is on some benefits so she might well qualify for a discount to her council tax going forward.

keyboardwarrior1

Better if the widow uses her time sorting out her own affairs with the help of her kind friend the op, rather than going to the newspapers accusing people of collecting money of doing their job. If council tax don’t know she’s widowed they don’t know why the tax isn’t being paid - yet have ways of helping her that she hasn’t yet asked for help

Mortgage company have said to pay what she can, hopefully there is an insurance policy, if not then unfortunately things maybe tuff, possible rent out a room to gain some income to help cover the mortgage

Yes 25% sole user discount. She needs to call the council
She should have called every provider to inform them of the death

If you want to help her, make a list
Banks
Credit cards( they should pause for 3 months)- if there’s no money in the estate, they will write them off.
Utilities providers
Insurance
Phone
Etc

Firstly, needs to check whether he had life insurance and whether they had mortgage / income protection insurance, usually you would get that when you take out a mortgage if you're sensible. I'm surprised she hasn't already done that. If she's struggling could you help her to do it?

Secondly, as PPs have said, she should apply for the single person discount on her council tax and council tax reduction (sometimes called council tax support). These are 2 separate things. She should ask for both to be backdated to the date of his death.

So it seems that there is indeed no state help for mortgages? Does that then mean that, if there is indeed no life insurance, my friend is going to have to sell the flat and move into rented accommodation, for which she would then be able to get help?