Signing house over to children before care

Bossyboots

Torry_Quine wrote:

Sorry but this is true, as I know from personal experience! A relative had signed her home over to us many years before and when she was assesed for council funding she was asked if she had owned the property, which solicitor had handled the signing over of the house and why she had signed it over.:

That does not make it a legal requirement that you have to use a solicitor to sign the house over. The answer to the question of which solicitor dealt with the transfer is simply none.

Bossyboots

woodside61 wrote:

I am planning the following

1. We are buying a house with no mortgage to live in
2 Putting the house in 5 names ie kids as well who are 12 to 8 yrs old
3. In 6 years time getting the oldest one to sell his portion of the house back to us and then loaning us the money we pay him for his portion which he can then claim back against the estate when we die and so on for each of the other 2 children when they hit 16 or the month beforehand to avoid issues of control etc

This way we can avoid a hefty portion of IHT in the future as well as safeguarding our house against spouses who marry into the family and then separate.

has anyone else thought of this or is it nonsense?

chris:beer:

Okay, and how are you a) going to ensure your children sell back "their" portion to you and b) then loan you the money back?

I'm not even sure your children are old enough to execute a legal transfer into their names anyway although I can't find any information that specifically says you have to be 18. They certainly aren't old enough to enter into a legal agreement with you to deal with the property as you expect. You are taking the chance that over the next 6 - 8 years you and your children will not fall out. Teenagers are unpredictable. If they don't do as you want, your property is at risk from their bankruptcy and future spousal claims while you could be stuck there for years being unable to sell if you should want to. Also, as part owners of the house they would be entitled to live in it. That could leave 8 of you living there if they all brought their partners to stay.

They would also be debarred from council house renting if they part own a property.

Fester_2

Am I right in thinking that should care become necessary for one parent , the house cannot be sold as an asset if the other parent and any children are living there as their permanent residence?
I presume the local authority cannot make people homeless?

Or will they demand the `share` of the person who has gone into care?

Torry_Quine

Bossyboots wrote:

That does not make it a legal requirement that you have to use a solicitor to sign the house over. The answer to the question of which solicitor dealt with the transfer is simply none.

If however we had not used a solicitor it would have been very difficult to prove the legal requirements that the house had been transferred for reasons other than to escape paying care fees. I'm merely trying to prevent people being caught up in a terrible situation whereby even though an elderly person had had no right in the property the council can take its worth into consideration many years after the transfer. There are no guarantees as the council can use the value of the property many many years later but doing things legally through a solicitor will help. For the sake of some peace of mind get it done as soon as possible via a solicitor. If not through a solicitor then surely some witness to the transfer will be needed or anyone could say I handed over the property to my family several years ago and the council would want proof!

Biggles

If the transfer is done, whoever by, it is recorded (eg in the deeds and/or on the Land Register) and it will then be a matter of fact and of public record.

And if a solicitor had been used, he would not have had any interest in, and would certainly not be able to pass any comments on, the reasons for the transfer.

Certainly care needs to be taken if you do the transfer yourself but, once it's correctly completed, it will be no different to a transfer carried out by a solicitor.

Ted_Hutchinson

Fester wrote:

Am I right in thinking that should care become necessary for one parent , the house cannot be sold as an asset if the other parent and any children are living there as their permanent residence?
I presume the local authority cannot make people homeless?

Or will they demand the `share` of the person who has gone into care?

I'm pretty sure edinvestor has detailed what should happen in one of his posts but there is a summary Help the Aged LA help with fees but that still doesn't answer the question "What if the children/grandchildren need to claim Means tested benefits while you are in your home and they (because their part interest in shared ownership of the family home is in the public domain) have to declare a quarter share in a property. As far as the state is concerned you cannot claim means tested benefits as a property owner unless it is your own home. You have to sell your disposable assets before you claim on the state.

EdInvestor

The LA cannot take the home if either the spouse of the person going into care, a child over 60, or a dependant (eg disabled) child is living there.

IIRC this may sometimes also be extended to someone who has been the person's full time carer as well ( eg perhaps if the carer is a daughter who is not yet 60, or a sister.)

Peter-Pan_5

Bossyboots,"They would also be debarred from council house renting if they part own a property."

well in Scotland that is not true,if you own a house with say 3 bedrooms and you dont need the rooms,you will get a council house which is smaller and still keep your house and rent it out.crazy but true I`m afraid.

Where we live a couple bought their council house at the discount,when the hubbie died she applied for a smaller house,she now rents from the council and lets out her original house.

Fester_2

Thanks for replies Ed and Ted.

Bossyboots

Peter-Pan wrote:

Bossyboots,"They would also be debarred from council house renting if they part own a property."

well in Scotland that is not true,if you own a house with say 3 bedrooms and you dont need the rooms,you will get a council house which is smaller and still keep your house and rent it out.crazy but true I`m afraid.

Where we live a couple bought their council house at the discount,when the hubbie died she applied for a smaller house,she now rents from the council and lets out her original house.

Well I can see that might have some uses but flipping heck. I know someone who was sleeping on her aunty's floor because she owned a house and the council had no obligation to house her. There were reasons why she couldn't live in the house which was then sold. They still wouldn't house her after that as she had sufficient equity to rent privately. They said she needed to rent privately until her savings dropped below a certain level and then they would be able to help.