Applying for the legal right to deal with someone's property, money and possessions (their 'estate') when they die is called 'applying for probate'.
If the person left a will, a Grant of Probate is issued. If someone did not leave a will, a Grant of Letters of Administration is issued. The person/s entitled to deal with the estate and the assets is called a Personal Representative.
In some cases, it is not necessary to obtain a Grant for example if the deceased:
- had jointly owned land, property, shares or money - these will automatically pass to the surviving owners
- only had savings or premium bonds
Rather ominously, the Government website advises those thinking about obtaining a Grant to:
'Contact each asset holder (for example a bank or mortgage company) to find out if you'll need probate to get access to their assets. Every organisation has its own rules.'
It is this lack of consistency across the lending industry that has led to alarming reports of banks releasing considerable sums of money to bereaved relatives who have no legal authority to deal with the finances.
Financial institutions have long been willing to release up to £10000 without production of a Grant on death. The justification for this is to relieve the burden on relatives especially where the estate is straightforward and the assets are modest.
However, the Building Societies Association reports that its members will often release up to £15,000 without production of a Grant.
Of most concern is that the Chair of Solicitors for the Elderly states that there are some lenders willing to release £100,000 and more without a Grant. The concern is that this is open to abuse and can lead to money ending up in the wrong hands.
When a loved one dies, it can be difficult to start thinking about paperwork and money, but anyone who thinks that they might be a Personal Representative, should locate any will quickly and ensure that all banks and building societies are notified about the death as soon as possible.
Many think that employing the services of a legal firm to deal with the estate of a deceased can be expensive. But a specialist will deal with matters quickly and in the long run, might ensure that many thousands of pounds are not handed out to rogue relatives.
To discuss this or any other private client matter, contact us.