Loan repayment following death
When a Home Equity Access Scheme (HEAS) participant dies, the loan under the scheme is usually recovered from their estate.
If a pensioner with a Home Equity Aceess Scheme loan dies and... | Then... |
there is no surviving partner, | DVA usually enforces the charge on the property used as security and recovers the loan immediately as a lump sum. |
there is a surviving partner entitled to loan payments but who does not wish to continue receiving them, | that person may choose to repay the loan at any time by making repayments or by withholding an amount from any pension entitlement. |
there is a surviving partner entitled to loan payments and wishes to continue receiving them, | Payments will continue and recovery of the loan is deferred until the death of the surviving partner. |
there is a surviving partner who is not entitled to receive Home Equity Access Scheme payments (for example they are below the pension age) | the loan may be recovered after the bereavement period.
Note: In this case, discretion exists to phase, delay or accept partial recovery where the family home is involved. |
Restrictions on recovery
The restrictions on the recovery of a loan are shown in the table below.
If a member of the couple dies and the partner... | Then... |
receives bereavement payment | the loan may be recovered after the last day on which a bereavement payment is payable.
|
is over veteran pension age and has use of all or part of the assets subject to the charge | the loan may be recovered after the death of the partner. |
Manner of recovery negotiable
Where the amount of the loan is recovered from a person's estate, it is expected that the full amount of the loan should normally be repaid by the executor of the estate as a lump sum. However, the manner of recovery can be negotiated between the Commission and the executor.