Power of Attorney

margaretclare

No, I am NOT thinking of setting up £50K savings accounts! That was the point of what I was trying to say.

The OP now says that his parents do not have much. Therefore, the response that someone gave to my post in the earlier thread is not relevant to them - nor to us!

With interest rates at the low level they are at present, even if I had £50K there is no way I'd put that amount into any savings account gaining 0.5%!!!

At present I have one tiddly little building society account, but most of my and DH's savings are in S&S ISAs which are at least growing.

inholms

dontknowwhatimdoing wrote: »

I quite agree with you - I was lucky (if that is the word) in that when my mother made her Will in 1995 she decided to have an Enduring Power of Attorney drawn up as well (just in case...).
She suddenly became physically ill in Feb this year and insisted I activate the EPA. All I had to do was take it to her Bank and Building Society, have an interview and then wait a couple of weeks for acceptance.
The bank chappie said how fortunate it was that mum had had the foresight to do the EPA when she did - he said it was a nightmare now.
She died in March but I did not even have to close her Bank account - I stopped all DDs etc but the Bank said keep the account unfrozen (there is apparently no legal need to freeze an account after a death - I had not realised this) and all dividends etc.. would still be paid into her account until Probate was sorted.
It also meant I was able to access money for the considerable amounts that had to be repaid - although I told the pension people etc immediately of her death, I still had requests for the return of overpaid pension, attendance allowance, etc and I also had to pay up all the utilities. Together with the funeral, this amounted to a fair bit. I would have had to raid my ISA if I had not had access to her account.
I just made sure I wrote in all correct amounts on the day of her death on the Probate form - so no underhand cheating has gone on.
The government really should keep their hands off the things that work and sort out everything else!
Good luck.

I agree, another case of fiddling whilst Rome burns!

Savvy_Sue

inholms wrote: »

Many thanks to everyone for your comments. I will follow what you suggest. I think the best route would be to consolidate my parents money (they don't have much) into one account and become a signatory.

Do check what will happen to a joint account on the death of the first one (cheery thought I know!) Some banks will freeze an account in that situation which can obviously cause difficulties.

emmielou

Hi,

I just thought I would point out that if one of your parents becomes mentally incapable of handling their finances its not actually legal to deal with the accounts as a signatory.

Its best to print out the forms, sit down at a quiet moment and fill them out. It could solve a lot of trouble in the future.

If they do become mentally incapable in the future and you need to sell the family home you will need to make an application to the Court of Protection and that will cost a lot more and take a lot of time (and stress).:mad:

The forms really aren't so bad once you get down to it and if you get stuck i'm sure lots of people on here would be willing to help!

As someone said before, you will only need to do a Property and Affairs LPA really.

dontknowwhatimdoing

Savvy_Sue wrote: »

Do check what will happen to a joint account on the death of the first one (cheery thought I know!) Some banks will freeze an account in that situation which can obviously cause difficulties.

I may be standing on a very sticky wicket by suggesting this but I was told by my Mother's Bank that there is no legal requirement to tell a Bank of a death - it is just that people seem to think they have to 'stop' everything at once and therefore once the Bank is told, they then are obliged to freeze the account.

This of course can lead to all sorts of problems if no other money is to hand.

If the account is joint, and only one has died, I have been given the impression that so long as the Bank has not been told officially, then the account can continue. (So long as a single signature is all that is required).

If any of you legal types out there know better, I would be grateful for your input.

For the record, my mum died in March - I have just had the Probate interview and am awaiting the Grant, when I can then deal with her finances properly.
Her bank and building society accounts are still active, with the Bank's blessing. I simply stopped all Direct Debits.

It may be, of course, that because I had POA and they got to know me before she died, I was not considered a threat.

Savvy_Sue

Yes, it may be different if there was already POA on the accounts. That didn't seem to be what inholms was suggesting however.

Of course there is another issue to consider in becoming a signatory on an account - if it's not absolutely clear who is a signatory and who the money actually belongs you, then any claiming of means-tested benefits becomes a bit of a nightmare. There are ways of becoming a signatory while still being clear it's not your money, apart from POA, but things do have to be clear.

misslawbore

emmielou is absolutely dead right. If Inholm's parents have a property it would be very unwise not to organise Lasting Powers of Attorney(Financial) for both of them at the earliest opportunity in case either one or both lose mental capacity. If he does not, he will have to go to enormous expense and trouble if/when they do lose capacity to apply to the Court of Protection to become a Deputy for his parents. If he does not apply to become a Deputy, the Local Authority may step in and do this to get their hands on his parents' assets for care home fees.

So clearly, doing 2 LPAs now will avoid all these pitfalls. Of course, where the elderly relative(s) do not have a property or much in the way of assets then I can see that a joint account with a friend/relative as signatory is a simple fuss-free way of dealing with finances. But as Emmielou said, as soon as the other signatory loses mental capacity, it will not be legal to continue to run the account. This may never get discovered and there are many such situations and mostly, there is not a problem. However, someone might meddle .... a relative or friend of the elderly person who has an agenda and thinks that the signatory is committing financial abuse. They can complain to the Office of the Public Guardian about this and remain completely anonymous while causing a lot of problems for the signatory, accusing them of fraud in respect of benefits etc.
Believe me it happens. The Office of the Public Guardian then raises all sorts of questions, wants to interview the signatory, get documents etc. And, if the OPG is still not satisfied, can refer the matter to the Court of Protection, the Local Authority and the Police. Scary.

inholms

Scary indeed, I make the point again, “I feel as if I’ve woken up in 1984” How have things come to this? It makes me wonder now what other things the Government have done in this clandestine sinister way. My thoughts at this stage are to do everything I can NOT to set up Enduring Powers of Attorney. To use the system would mean that the Government has won and could claim it works. I would prefer to find legal and effective ways round it. Such as transfer of bank accounts and transferring the deeds of their house to me. After all this is absolutely my parents wishes for when they die. I will not submit to this draconian charade and I would have thought that if we all put our minds together we could create a set of advice / guidelines for others to circumnavigate this nonsense for most cases.

monkeyspanner

inholms wrote: »

Scary indeed, I make the point again, “I feel as if I’ve woken up in 1984” How have things come to this? It makes me wonder now what other things the Government have done in this clandestine sinister way. My thoughts at this stage are to do everything I can NOT to set up Enduring Powers of Attorney. To use the system would mean that the Government has won and could claim it works. I would prefer to find legal and effective ways round it. Such as transfer of bank accounts and transferring the deeds of their house to me. After all this is absolutely my parents wishes for when they die. I will not submit to this draconian charade and I would have thought that if we all put our minds together we could create a set of advice / guidelines for others to circumnavigate this nonsense for most cases.

I can see your objection to the new LPA regime. If your parents do transfer the ownership of the house and their other assets to you there are other matters you will need to consider.

You will need to consider what would happen if you predecease your parents, if you don't change your will that could leave them homeless. Even if you do change your will the likelyhood is that your estate could become liable to inheritance tax especially if their home is worth close to or over the IHT limit as this would be considered your second property. Would there be enough cash to pay the IHT without a forced sale of the house?

If they continue to live in the house and do not pay a commercial rent to you then the property transfer could be ignored by the Inland Revenue when they die as they will have retained the use and benefit of the asset.

If they need a care home sometime in the future then the council may refuse to help to fund them as they will have deliberately deprived themselves of assets. The likelyhood is that the assets would still be counted as theirs in any assessment especially if this need arises soon after the transfer.

Personally I would go for the LPAs and try to set them up myself. From my experience the medical LPA is probably not required as the NHS will normally consult the family anyway. Even the simplest things like Pension and benefits become virtually impossible to deal with if someone becomes mentally frail and a POA is not in place, and frankly even with one in place some banks are very difficult to deal with.

DiggerUK

inholms wrote: »

I would prefer to find legal and effective ways round it. Such as transfer of bank accounts and transferring the deeds of their house to me./QUOTE]

With regards the property, you would be advised to check if it is a Joint Tenancy, (JT), or a Tenancy In Common, (TIC).

If it is a TIC you can avoid the dangers of costs being charged against the property if residential care is ever needed.

Again there has been discussion on this.
Check PatWinnings thread, "help please, any appreciated!!!!!!!" for info on this.