My list of properties is ready. It mentions all assets movable and immovable. It also mentions my shares in assets that I hold jointly with others.
Now I must also make another list showing my debts and liabilities. I will include in this list:
- Loans and advances taken from banks and financial institutions:
my customer ID, account number, name of bank and branch, instalment periods, amount due.
I must also make a separate file for documents about each loan, especially the loan agreement. If I do not have copies of documents, I must get them from the bank.
- Similar details and documents for loans and advances for which I am guarantor. My heirs are liable after me for loans which I have guaranteed.
- Mortgages, pledges, hypothecation of my property or insurance policies given as security of loans or advances:
Description of property or policies, details of loan, purpose of the loan, and whether the security is given as borrower or guarantor. I must keep a file containing papers about the security.
- Amounts I owe to other persons, for example, personal loans taken from private parties:
Details of the lender or creditor, loan, interest rate.
If I maintain books of accounts for my business, I need not mention my business debts in this list.
- Details of litigation that I filed or are filed against me.
Case number, name of court, names of parties, brief statement of claim, brief statement of defence, prayer made.
- Potential claims that I foresee.
- Details relating income tax or other taxes:
PAN number, name and address of tax adviser.
I will keep a file of returns filed and assessment orders for past five years.
- Anything else that I think my heirs will have to bear or pay after me.
I make this list for many reasons:
- After me, everything I owe to others can be paid from my properties.
- After me, my relatives should know about these, so that any claim will not take them by surprise.
- After me, my heirs can decide to pay off or settle so that the encumbrance on the estate they inherit can be removed.
- If my asset is mortgaged or offered as security, the claim that it secures will be paid from that asset. Therefore if I give by will my mortgaged house to my daughter, she will know that the house is subject to mortgage, and the bank can recover its loan by selling it. I will also be conscious about this if I decide to give it to her by will.
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– Nilima Bhadbhade