Do we accept shares I Mum's house?

miggy

This might not be the right place to post this query (sorry!) I just can't decide what title it comes under.
I'm hoping someone can tell me what questions I ought to be asking or give some general advice.

The situation is:

My parents had mirror wills and when Dad died the house passed to Mum (this was in May.)
My sister and I are both married homeowners.
My sister, her husband and my husband are all wage-earners/taxpayers.
There are three children in my family, aged 11-15 (i.e. the eldest can expect to be earning or at Uni in a few years, but we will have at least one at home/in education for a while yet.)
My sister doesn't have children to consider.
Mum is happy living where she is but has a disabilitiy which may mean she has to move to residential care.
The house is part-mortgaged and mum doesn't intend to pay off any of this (it was an income-generating scheme.)

My sister and I have been contacted by Mum's solicitor to say that Mum would like to make over half the house to us as the value of that part would then be in our hands and couldn't be used to pay residential fees. There is the possibility that if Mum lives long enough, we would be exempt from Inheritance Tax too. This would be done through a Deed of Variation, (quote) "which in effect re-writes (your father's) Will as though he had given his half share of the house to you both before his death."
That's as I understand it. The solicitor is very helpful but I'm aware she's acting in Mum's interests and Mum, though trying to benefit us, may not see any difficulties that might arise for us through what's effectively a fairly hefty transfer of assets.
As far as I can work out, as it would be an asset not a source of income, it wouldn't affect anything to which the children might be entitled, or we might need to claim on their behalf.
The solicitor says that if ever we were debt and assets had to be liquidated, the house would be affected but the other owners would be taken into account. This isn't likely to happen but I wanted to cover all eventualities.
I am about to contact the solicitor to ask whether we would be obliged to charge Mum rent, as we know of someone who ended up in court through not paying rent on a property they lived in and part owned.
I ought to make it clear I am poor-ish but happy and could really do without taking this on. The kids think I'm mad but mentally I left that house many years ago and was resolved it would just be sold to pay the Building Society. I don't want the emotional baggage but it will have to come in one form or another and it might as well be in a way that will help Mum. We get on quite well but she's very hard of hearing in addition to her other disability so I am avoiding trying to talk it through with her till I have my own thoughts straight!

What I would like to know is: what are the pitfalls? What would we be letting myself in for? What do we need to get in writing? There is no way, on our present income and with our present responsibilities, that we could take on more financially.

Any suggestions gratefully received!

myrnahaz

I thought that the homes of care home residents' were not sold to cover costs any more - it might be worth checking up on this. With regards to taking over half the house - you need to check whether you'd be lumbered with paying the mortgage after your Mum's days, because I don't think that debts die with the debtor - I think it passes to the estate. You could ask someone's advice at CAB.

miggy

myrnahaz wrote:

I thought that the homes of care home residents' were not sold to cover costs any more - it might be worth checking up on this. With regards to taking over half the house - you need to check whether you'd be lumbered with paying the mortgage after your Mum's days, because I don't think that debts die with the debtor - I think it passes to the estate. You could ask someone's advice at CAB.

Thanks, I need to check up on this. The solicitor seems to think it would have to be sold. As Mum is the only one living there there is no question of anyone being made homeless.
I gather the house will be sold when Mum's gone in order to pay off the mortgage, but there is expected to be plenty of equity to pass to the estate, hence the desire to stop some of it going into care home fees. The mortgage is probably less than half the value of the house.
I know when Dad was in a residential place (too ill to stay at home), Mum had to pay a relatively small amount each week towards his care.