NSW Estate Planning - Verbal Agreement about Mortgage Repayments

[Sydney]

Hi....I have been the sole carer for my mother who has major medical issues for the past 4 years. I had to leave my full time employment to care for her. We have shared a house for the past 20 years, both of our names are on the mortgage but I have paid the mortgage repayments.

I have the authority to liaise with Centrelink etc for any issues relating to her pension, and also have authority to access her bank accounts for paying her bills etc. My mother and I have a fantastic relationship and she knows that she can trust me 100%.

I have an older brother who has never offered to also care for her, is very selfish and keeps asking her what she is going to leave him when she passes away. This has now come to the point that my mother will not talk to him and has recently changed her will.

Previously both him and myself were nominated as Power of Attorney and she has now changed her will making me the sole trustee. She has stated that she wishes to leave her share of the property to me, she has left her grandchildren a certain amount of monies and my brother any residual.

She currently has two bank accounts with substantial amounts and has verbally stated to me that if anything happens to her that she wants me to transfer the money from one of her accounts to put towards the mortgage. She wants me to do this as she knows that I will then not be able to claim the current carers payment and it might take some time for me to find suitable employment.The other account is to be used to pay the Grandchildren their amounts and my brother will get what's left.

I have told her that I would feel uncomfortable doing that and if she wanted to leave that amount to me it's best that she puts it towards the mortgage now whilst she is still alive. I thought that would be the best way to avoid any drama with my brother in the future.

If she doesn't pay it towards the mortgage now and I then transfer the money from one of her accounts towards the mortgage (which as stated previously is in both our names) does my brother have any recourse? Does he have any rights to know what amount has been transferred from her account and where that amount has been paid? Can he do anything legally?

 

[Sydney]

Any suggestions or online legal advice would be appreciated.

 

[ClareB]

When you say "if anything happens to her that she wants me to transfer the money" - do you mean, in the event of her passing?
Following a death, the bank account will need to be closed and hence, your Authority to access your mother's account will cease.

When the bank account is closed, a new account is opened for the Estate and this is where the assets, profit from sales of assets, compensation payments etc. are held.

If your mother wishes for a certain amount from her bank account to be paid towards the mortgage, the safest action would be to have her transfer it herself at the earliest convenient time.

Otherwise, your mother can amend her Will with a clause stating that she wishes for a certain amount to be paid towards the mortgage upon her passing.
In addition to this, it would be beneficial for your mother to attach a hand-written note confirming and detailing her intentions of paying money towards the mortgage.

At the end of the day, you should ensure that your mother's intentions are clear prior to her passing. A verbal conversation between the two of you will not be enough. Have her transfer the money now or amend her Will with an attached hand-written note.

I definitely recommend that your mother's Will be drafted by an expert Estate solicitor, especially if there is a chance your brother may contest the Will.

All the best.

Clare

 

[Sydney]

Thank you Clare,

Yes I did mean in the event of her passing, she recently amended her Will as my brother was harassing her as to what she was leaving him. She is a very ill woman and he has stressed her out regarding this on numerous occasions. This last occasion she ended up back in hospital as she couldn't eat or sleep thinking about it all and her health deteriorated further.

You mentioned that her bank accounts will be closed, as both her name and my name are on the Mortgage what will happen with that? I presume that this will also be closed as well and the Mortgage will have to be put solely in my name? I also have a payment in advance amount to reduce the interest and I redraw from that for living expenses etc. Will that amount be affected at all?

Thank you very much for your advice Clare, I shall pass this information onto her and she can then decide what she would like to do.

Kind regards