Older borrowers heighten their risks by neglecting estate planning

Published: 14/10/2013

In anticipation of the launch of Write and register a Will week, beginning 14 October Eddie Goldsmith, Senior Partner at property solicitors Goldsmith Williams highlights the importance of having a Will in place for older borrowers and homeowners.

‘Whilst the reports of recently published research showing that a majority of the adult population is without a Will seem ‘more of the same’ (this proportion has remained flat since 2009) there is an aspect to these findings which is particularly pertinent now. A hot industry topic is the increasing incidence of older borrowers, and these research reports highlight that the proportion without a Will has climbed significantly amongst older age groups.

As the number of older people with mortgages increases then the chance of one of the joint borrowers (or a sole borrower) dying whilst the mortgage is still in force is also increasing. Those borrowers who do not have a Will in place could leave behind a complex legal situation for their families to address at an already stressful time.

This legal situation is influenced by two factors. One of these is the basis upon which the property is owned – as Joint Tenants or Tenants in Common. The second is that the mortgage terms and conditions along with the lender’s deceased borrower policy will dictate the lender’s approach to situations where one of / the sole borrower is deceased. For example, in the case of joint borrowers the mortgage terms and conditions may state that the lender’s power of sale arises 6 months after only one of the borrowers dies. This already complex situation is compounded where the deceased is intestate.

Brokers can help older borrowers manage this situation by recommending a conveyancing firm that takes a comprehensive approach to the client’s legal needs and encourages the client to take legal advice regarding estate planning. Those brokers who take this wider view can differentiate their service offer to this particular client group and in so doing enhance their own reputation.’

Content correct at time of publication

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