Shared Home with Elderly Parent

goodadviceneeded_2

I'm in need of advice about the risks of sharing a home with an elderly parent. My mother has lived with me for almost 2 years but my accommodation is not suitable for her diminishing mobility issues. Therefore, we are going to buy a more suitable home. She will put in £100,000 from the sale of her house and I will fund a further £200,000 from the sale of my current home and a mortgage. She would be a one third owner in this new house. I will ensure that legally, she has a life interest in the house if she were to live longer than me (and my children fully support that) but my question is related to any future care that she may need. Could I be forced to sell my home to cover the cost of any care, should she require this in the future?

I've read somewhere that if my mum "gifted" me her share of the house and I "charged" her a market rent to live there, we could get round this problem but it is a difficult discussion to have!

Thanks, J

superbabe612

You need to get some professional advice from a solicitor and a mortgage broker/lender.
We had a similar situation with my disabled father-in-law; we wanted to buy a house together for us all to share, but the mortgage lender would not allow his name on the deeds without him being on the mortgage, but he wasn't allowed on the mortgage because he was past retirement age! I think there may be a few lenders who do provide mortgages to the elderly but it would be a special case.
As far as I know, most lenders will require all adult occupants of the house to be named on the mortgage, or to sign the mortgage deed to the effect that they relinquish their claim on the property.
If your mum 'gifted' you her share, the gift may be seen as the 'deprivation of assets' to avoid paying the cost of any care in the future, which in itself would cause problems with the local authority, but in the immediate future it may put your mortgage lender off lending you any money if they think the local authority would have a claim over the property.
I don't know much about the possibility of renting a room to your mum - you'd probably need your lender's permission to do that, as well!

It would be nice if society could allow adult children look after their elderly parents by joining forces in this manner, but when we tried to do it, we just hit brick walls all the way along!

Good luck!

Stefan1

Nice read with tips and ideas about the sharing Home with Elderly Parent,.
Keep sharing dude its really useful one,.

00ec25

goodadviceneeded wrote: »

Could I be forced to sell my home to cover the cost of any care, should she require this in the future?

I've read somewhere that if my mum "gifted" me her share of the house and I "charged" her a market rent to live there, we could get round this problem but it is a difficult discussion to have!

You will not be forced to sell up,
however, the council may put a charge on the property to the value of your mother's share of it when she went into care so that when it is eventually sold the council will get its due share of the proceeds to recompense it for the costs of her care, ie care first, pay later.

don't know how gift and rent works in deprivation of assets cases but Mother paying rent is certainly a legit way to reduce inheritance tax rules as if she pays a market rent then it is no longer classed as a "gift with reservation" which is what it would be if she gifted it but then lived there rent free (ie she continued to benefit from something she had allegedly given away)