NSW Property Investment and Adverse Possession After Death of Owner?

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Una

Member
12 December 2018
1
0
1
Hello,

My grandmother passed away in September this year and my dad and I have lived in her house for 17 years since my mum passed away in 2001. My dad's sister took out a loan where my grandmother was guarantor and now due to her passing, we have to sell the house to pay the bank back.

My grandfather built our house and my dad was planning on selling a property investment of his in order to buy my aunty out so that we can stay in the house. But, I did legal studies at school and remembered adverse possession. I was wondering if this would apply to my dad so that the bank wouldn't have the ability to take our house?

Please, we need answers and help.
 

Scruff

Well-Known Member
25 July 2018
902
133
2,389
NSW
Your grandmother's passing doesn't in any way affect your aunt's liability for the loan - she is still the borrower and must still make the repayments. So the question is - has she defaulted on the loan?

If she is thinking "mum was guarantor and now she's gone, I won't bother making any more payments", then I would be viewing this as attempting to defraud a deceased estate. If this is what you suspect, then I recommend you see a lawyer immediately.

In regard to adverse possession, from what I've read about it, it wouldn't apply. Given that you've been living there for 17 years and your grandmother only passed away a few months ago, it seems obvious that there was some kind of arrangement in place. That alone would negate eligibility, because you're occupation is not "adverse to the title of the owner", but was instead "consented to". In NSW, there must be no such arrangement in place for a continuous period of 12 years in order to be eligible for adverse possession.

Your grandmother's will (if there is one) also needs to be considered.