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Clare, Solicitor
Category: Law
Satisfied Customers: 35056
Experience:  I have been a solicitor in High Street Practice since 1985 with a wide general experience.
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I an handling my brother's estate, I have been granted Letters

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I an handling my brother's estate, I have been granted Letters of Administration. I have instructed a solicitor to help me but I need a second opinion on a particular issue. My brother brought an investment property with a friend less than a week before he suddenly died. As my brother had recently inherited from our parents he paid cash for a 25% share the property. He paid this sum into a joint bank account with his friend just before completion on the property. His friend needed to take out a buy to let mortgage to purchase their share. Due to their financial position they were unable to secure the buy to let mortgage alone so my brother added his name to the joint mortgage. Now that he has died his friend is maintaining that my brother's Estate must repay 25% of the joint mortgage. They say it is none of the Estate's business what happened to the money by brother paid into the joint account. (The money definitely left the account as I know the closing amount was only £700, which was of course passed to his friend.) The solicitor acting for the Estate has told me that there is really nothing I can do about the 'missing' sum, which is in excess of £30,000 and that we have to pay a 25% share of the mortgage as my brother's name was on it too. I don't want to get into a bitter dispute over this but on the other hand £30,000 is a considerable loss to the Estate and I feel it is my duty to ensure I have done all I can to recover it. Is there anything I can do? Also I am sure that my brother would have insisted on taking out a Life Insurance Policy or Mortgage Protection Policy but his friend is not forthcoming on this matter. Is there anyway I can find out if such a policy was taken out and if so can the Estate insist it is used to repay my brother's 25% share of the mortgage. Many thanks, Diane
Thank you for your question.
My name is Clare
I will do my best to help you but I need some further information first.
How much is the property worth and how much is outstanding on the mortgage?
Customer: replied 2 years ago.

The property was purchased a year ago for £185,000 and my brother paid in £47,500 into the joint bank account for his 25% share. A mortgage was taken out for £112,000. My brother's friend maintains the Estate's share of the property will total £18,250.00 calculated as follows: £185,000 minus £112,000 repayment of mortgage, balance £73,000 with 25% paid to the Estate £18,250. As you can see an investment of £47,500 does not warrant a return of £18,250. Obviously the Estate has to agree to sell the 25% share to my brother's friend. Can we offer to sell it at £47,500?

Was there a Declaration of Trust drawn up dealing with the issue of the division of the equity
Customer: replied 2 years ago.

I don't know. How would I find out?

Have you spoken to the people who handed the purchase?
Customer: replied 2 years ago.

No. Am I entitled to contact them in my role as Administrator of the Estate? What should I be asking for?

You are indeed entitle to contact them in that role and to ask what arrangements were made about what should happen in the event that the property was sold - and what advice they gave your brother about protecting his investment.
Clearly you can also go through all the paperwork and check whether or not there is evidence of insurance having been taken out.
If there is no Declaration of Trust then I am afraid that the state will only be able to claim 25% of the equity.
I am sorry not to give better news - please ask if you need further details
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