Hi 194 and welcome to the forum.

Sorry to hear of your loss.

When you say you are due a share of the inheritance, is it only the share in the property or is there anything else i.e. pensions, life insurance or other assets that you would be due?

In terms of the Trust Deed the Trustee has a responsibility to ingather as much as possible for the lenders and if they are able to repay the full debts, plus interest and their costs and fees then the Trust Deed can be brought to a close early.

If you are due a mixture of assets in terms of the inheritance then these other assets could be enough to clear your Trust Deed and leave the property alone. If there are no other assets apart from your share in the house then the Trustee will need to take steps obtain your share of this.

I’m not qualified in mortgages so it’s best to reach out to an independent financial advisor to ask them about the possibility of a mortgage. What I will say is that based on my experience it can be extremely difficult for a client to obtain a mortgage whilst in a Trust Deed. It could therefore be an idea for your wife to take a mortgage over the property in her name and she could use these funds to clear off your Trust Deed. An IFA will be able to confirm the best option regarding this.

What was the deal in terms of your Trust Deed and the property? Do you have equity in it?

I can’t see why you would need to sell your property if you decided to move unless it was to free up equity to use to carry out the repair work etc.

It’s hard to be more specific without knowing the full details of your Trust Deed and estate of your dad but what you are asking to do might be possible. If you speak with your Trustee they should be able to work with you as much as they can to find a solution that hopefully works for everyone.

Hi 194, sorry about your dad.

From what you have said, I am guessing that your share of the property of £75k is likely to be enough to pay off all of your debts in the Trust Deed, is that correct? If so, and if there is also enough to cover the trustees costs and outlays and interest on the debts, then you could be discharged early from your Trust Deed.

However, I suppose the problem will be realising these funds without having to sell the property. As David suggested, it may be difficult for you to get a mortgage whilst in a Trust Deed, so perhaps it may need to be in your wife that does it. As long as she can borrow enough to purchase the house and also pay enough into your Trust Deed to satisfy that obligation then there should be no problem. Your trustee would need to be kept informed of the transaction obviously, and will no doubt insist that a sufficient amount of the proceeds are paid directly to them by the solicitor dealing with it.

Hi David/Kevin

Thank you both so much for the feedback here, greatly appreciated.

The property will be the main asset/inheritance and my share based on recent valuation would be £75k. There are some additional assets and I believe my share of these would be around £5k.

My debt on entering the Trust Deed was around £60k and we did have a little equity in our property at this time which was included within the Trust Deed and resulted in the Terms of the Trust Deed being 4 years and 4 months at the outset - the 4 last months payment representing the equity.

If the property was to be sold, I'm assuming there could be some understanding from the Trust Deed regarding doing some work to it before sale?

I'll reach out to an IFA for some guidance so thanks for that recommendation.

Many thanks once again - I've always found the Forum to be exceptionally helpful.

Hi 194,

If your debts were £60,000 then interest on top of that plus the Trustees fees and costs could come close to the figure of £75,000 of even exceed it. The amount you will have paid into the Trust Deed already will be deducted from the final balance. I’d reach out to the Trustee to ask them for an amount that would be required to close off the Trust Deed.

If your wife was able to secure a mortgage on the house and pay the Trustee the money to clear it then it should be fine.

When you say your share, are there other people due a share of the property? If there is how would they get their share of the property if it isn’t sold? For example if the house is worth £300,000 and there are 3 other people due £75,000 how would they receive this. Would your wife be able to secure a big enough mortgage to facilitate this?

If it did come to a house sale then the Trustee is required to maximise the sale price so a sensible discussion could take place about some repair works.

Hi David

There is one other person entitled to a share of the property and their share (given current valuation) is £25k.

I have just recently received the house valuation from a surveyor which will be presented to the Lawyer next week - at this stage it will go through confirmation which is likely to take 12 weeks plus. Given these timelines, do you think it would be acceptable to reach out to the Trustees now and given them this latest update and also enquire about what the amount would be to close the Trust Deed early? Alternatively, do you think it would be better to wait the 12 weeks plus (conclusion of the estate) and make this enquiry then?

Many thanks.

That could make things a little more achievable. I was worried there were other parties due £75k too.

I’d reach out to the Trustee now to start discussing what you would like to do. That way they can review your case and then calculate the amount due to clear the Trust Deed early and you at least have a couple of months to investigate your wife getting a mortgage and work out some options.

Let us know how you get on.

That is great - thanks so much David. Really helpful to get your guidance on this one.

Hi David

Just to update - I've spoken to the Trustees and they are going to send out a balancing figure on my account that would enable it to close early. They couldn't advise much beyond this (although did indicate that as long as my monthly payments continue they would be happy for me to get involved in the sale including prepping the property) so will just wait to receive this and then review options from then.

Thanks again for your guidance - just found things pretty difficult recently with the uncertainty and loss so it helps to get your guidance here.

Hi 194,

That’s really positive and encouraging to hear that the Trustee is happy to work with you regarding the whole situation and being involved in any sale. This is how it should be.

I understand it’s a pretty stressful time so anything we can do to help in terms of advice just ask. Keep us up to date with how things work out.

Hi David

Hope you don't mind me reaching out again but just received the Cost Breakdown from the Trustees and it is £97k. This figure includes £21k for 'Realisation Fee for funds ingathered'. I'm not 109% sure what this relates to. Are you able to advise at all please?

Many thanks.

Hi 194.

A quick response from me until David sees your post.

Your trustee agrees a basis for their fees with you and the creditors at the start. This usually includes a fee that is a percentage of the amount that they realise (collect) into your trust deed.

I believe this will be the basis for the realisation fee for funds ingathered that you are seeing.

Details regarding your trustee's fees should be on the documentation you received at the start. You may wish to check this if you still have the documents.

Hi

Thanks so much for the quick reply, really appreciate that.

There was a fixed fee from the Trustee (which is included in the breakdown) as well as a fee for outlay incl. estimate to close. On the original agreement there is a % (20%) fee for the Trustee on realisation of moveable assets, heritage and/or contributions. I'm assuming this £21k charge might relate to this 20% element? Does that seem to make sense? Apologies for the questions but just unclear at this point and keen to understand.

Many thanks again.

Hi 194.

This does make sense.

A percentage of realisations is a normal fee to include. It does seem to add up to a huge sum of money in these particular circumstances though.

Thanks again - the guidance and support provided by the Forum is exceptional.

I've left a message with the Trustee for a call back as would be keen to understand the calculation. In addition, I'd like to understand my options here. I suppose there is no urgency but always find it helpful to have some clarity.

Thanks so much once again.