Can rent be collected after death by the executors?

by Readers Question

8:52 AM, 23rd February 2016
About 3 years ago

Can rent be collected after death by the executors?

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Can rent be collected after death by the executors?

We are having our wills renewed, as they where written 26yrs ago, and our situations have changed. will

Our children are now old enough to be executors of our will and we now own some rented properties, which I don’t know if it makes things more confusing.

My main concern is can rent be collected on the rental properties, all on BTL mortgages. We saw a solicitor on Friday and I asked if this can be done, as I know our bank accounts will be frozen on 2nd death, but he said it would be no problem having rents paid into the executors account, this did not seem correct to me, and initially he didn’t to have an answer.

Can this be done or am I been given wrong information, as I don’t want to cause a problem later.

Many thanks

Peter



Comments

Paul Franklin

9:43 AM, 23rd February 2016
About 3 years ago

I remember dealing with a case like this a while back and although my memory is hazy I remember that the rent continued to be paid upon the landlord's death but had to do to the family member who held the 'letters of administration' (via the solicitors). But yes, rent can and should be continued to be paid after death and go the the executors of the will.

Mark Evans

10:06 AM, 23rd February 2016
About 3 years ago

I am also updating my Will and was looking into this area. My solicitor suggested I would need to check the details of my BTL mortgages. I wrote to Platform Mortgages and with this lender and my situation it would mean on my death that the properties would need to be sold. They are solely in my name but even if I wanted to leave them to my partner in my Will the lender would consider the mortgage agreement ends on my death hence the properties have to be sold. I think different lenders take different views so you would need to check. Hope this helps.

Ravi gupta

12:17 PM, 23rd February 2016
About 3 years ago

I have also a will written down, but I have not mentioned anything about rents, although my property is divided to go to my family.
Should I have write something about rent collecting? any comments/ advise please!

Steve From Leicester

13:24 PM, 23rd February 2016
About 3 years ago

As an agent we continue with the tenancy but hold the rent in our client account until we've received written confirmation of who the executors are.

Once we know who the executors are we serve the tenants a Section 48 which simply informs them that from now on their landlord is "The executors of the late Mr Landlord". The executors become, in effect "the landlord" and we take their instructions in the normal way (i.e. pay rent over to them, follow their instructions about renewing or ending the tenancy etc).

The bit we can't help with is the mortgage - the executors will need to approach the lender and find out what their position is. In our experience they will insist on the property being either sold or re-mortgaged to a beneficiary who meets their underwriting criteria.

Even where the property has to be sold they usually allow a realistic timeframe so long as the executors ensure the mortgage payments continue to be met.

Harry Chunk

17:28 PM, 23rd February 2016
About 3 years ago

The duty of the executors is to ensure the content of the will are carried out to the wishes of the deceased and ensure that the interests of the beneficiaries are looked after. They also have to deal with Probate and ensure any taxes are paid. If they act outside their powers they can become personally responsible. In the case of an ongoing business monies can still be collected so rents should be collected by the executors and paid into an executors account. That way they can ensure any mortgages are paid. If you tell the mortgage company they will want the mortgage repaid and very often the only way to do this is to sell the property however it may be possible for the beneficiaries to remortgage if they get the value/equity in the property once taxes and Probate have been sorted. In my experience it is best to delay telling them for as long as possible however banks do have a habit of returning payments account holder deceased. As you haven't died yet it's a bit academic, come back when you do.

Puzzler

10:57 AM, 27th February 2016
About 3 years ago

Take out life cover for the mortgages or accept they will have to be sold or remortgaged by the beneficiary. However rent can still be collected by the executors once probate is granted. Before that the agent can collect the rent on their behalf, you can also speak to your bank (or the executors can) and although the account is frozen for payments out, they may allow payments in


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