Borrowing money to pay for care

Mojisola

Before Mum died, Mum and Dad had enough money coming in to pay for the care they needed. Dad's income has now halved but he needs about the same number of hours of care as they had before so we're looking at ways of paying for it.

At the moment he has a small amount of capital which can be used to make up the difference but that will eventually go and we need to plan ahead for that eventuality.

If a family member loaned him money to pay for care and he then wanted/needed to go into residential care, would that debt to able to be repaid from the sale of the house or would the LA count paying it off in a lump sum as DOC?

gizmo111

What care does he need - has he asked social services for support to top up to what he needs?

Mojisola

gizmo111 wrote: »

What care does he need - has he asked social services for support to top up to what he needs?

SS care now seems to be limited to getting people out of bed, washing and dressing and microwaving meals.

He can manage his personal care as long as someone helps sort out his clothes and is present in the house while he has a shower because he does have falls.

I stay overnight and sort him out in the morning and then he either has a carer in at lunchtime or evening meal time and I do the other meal. He also has a cleaner and a gardener and someone one morning a week to take him out.

I am much recovered from being very ill with ME but I am overdoing things at the moment so need to step back a little. If I get too ill to help him, he will have to go into a home and, at the moment, he would rather stay at home.

I've looked at equity release schemes but they don't seem to give a very good deal. That's why we wondered about keeping the loan within the family but the person loaning the money has to be certain that they will get it back.

azzabazza

I am in the process of completing an application for Attendance Allowance on behalf of my mother who has Alzheimer's. This is non-means tested as far as I can see.

Here is a link to the Direct Gov page.

http://www.direct.gov.uk/en/MoneyTAXAndBenefits/BenefitsTaxCreditsAndOtherSupport/Disabledpeople/DG_10018710

Mojisola

Dad is getting AA and Pension Credit. This is what's helping pay towards the carers at the moment.

azzabazza

Sorry I can't offer any more advice. It is an uphill struggle isn't it, getting the help required.

GobbledyGook

Do you claim carer's allowance for him?

What help do you need to pay for? Maybe if we knew which help then someone might be able to point you in the right direction?

Mojisola

GobbledyGook wrote: »

Do you claim carer's allowance for him?

What help do you need to pay for? Maybe if we knew which help then someone might be able to point you in the right direction?

I don't claim CA because then he would lose his SDP.

I'm pretty well-versed on all the benefits and free care that's available because I've been caring for Mum and Dad for years now. With their joint income, we've managed very well.

Now that he's managing on just his money, it isn't covering all the bills. He may decide to go into a care home later on but, at the moment, he wants to stay at home with his memories of Mum. Funding a care home won't be a problem because the house will be sold and that capital will last for a few years.

I want to avoid using an equity release scheme because they don't seem very good value which is why we came up with the idea of a relative loaning money which could be repaid when the house is sold - either because he has decided to go into a home or dies.

I've got to be able to guarantee to the relative that they will be repaid when the house is sold. It won't be a problem if he dies while still living at home because it will be repaid from the estate.

I'm just concerned that if he decides to go into a home, the LA will consider repaying the loan to be DOC.

*Robin*

If the money would not be needed by the family member who is in the lucky position to be able to loan it, until after Dad has gone, and the estate is certain to be large enough to settle all debts, then surely written evidence of the loan would be sufficient for the executors to repay it when they get probate?

Or Dad could add a codicil to his Will stating that the loan should be repaid before his residual estate is divided, perhaps?

Ok I know most people find this topic distasteful, but being open can make life much easier for a beloved relative in their last years - I know a couple of arrangements like this which worked happily (thanks to a a family member who has done very well in their career and would rather their aunt/grandma was as comfortable as possible than get a measly interest from the bank - in each case a cash gift was rejected, but the relative agreed to the loan).

Dunroamin

I have no idea whether this is practical or not but could he sell the relative a share of the house? Alternatively, is there a way that the relative could put a charge on the property?

Mojisola

*Robin* wrote: »

If the money would not be needed by the family member who is in the lucky position to be able to loan it, until after Dad has gone, and the estate is certain to be large enough to settle all debts, then surely written evidence of the loan would be sufficient for the executors to repay it when they get probate?

Or Dad could add a codicil to his Will stating that the loan should be repaid before his residual estate is divided, perhaps?

Repaying after he dies isn't a problem. We would get a written agreement and, as executor, I would repay it before the estate was distributed.

My problem is the Local Authority's attitude to such a loan. If Dad wanted/needed to go into a residential home, then he would have a financial assessment. He would have to pay initially because the house would be sold. I need to know for sure that the LA would allow us to repay the loan when the house was sold without counting it as deprivation of capital.

I'm worried that they would say that he had to use all his capital (until he got down to £23,250) and that the loan repayment would have to wait until he died.