Combining Finances with mum

FredTheFifth

My wife and I's house value: £220K
Mums House: £180K

Combine to purchase a house for £350K and live together.

What are the risks, particularly if Mum gets poorly and needs to go into care. Not likley because all is well right now but just worried that if she did get poorly we might have to sell the house to release Mums capital.

Would it be any different if we extended our own house to accomodate her?

Any advice or links please?

Appol's that this might not be the right forum but could spot a complete fit.

Thanks.
FTF

Fire_Fox

I think you are on the right board and good questions.

There are disregards if others have an interest in/ live in the property, for example husbands/ wives. AFAIK they cannot force a sale tho they could encourage you to buy your mother out. They could also invoke deprivation of assets (refuse to fund care) if it was believed this was done to avoid paying care home fees whih seems less likely given your current circumstances. AFAIK there is no black and white answer but if your mother is well now I would not worry over much, rules can change anyway.

Being joint tenants or tenants in common with your mother will have a bearing, you should take legal advice on the implications of each - for example if you die before your mother or you and you r wife divorce. Also be aware if there is self contained accommodation it will be liable for its own council tax. Being self contained makes it lettable without affecting your quality of life which is one way of releasing money for care. If you extended your own home ... again deprivation of assets could be relevant, who is on the deeds and how.

BobQ

If your mother sold her house and used part of the proceeds to pay for some of an extension to your house or contribute to the purchase of a house you own and lived in the house for several years before the care situation arose then financially the position would be vague enough that they would probably not count the house as part of her assets. Obviously if it was only a few years they might be more inclined to investigate.

From your mother's point of view its probably a bad idea and no professional legal or financial advisor would recommend it. They might recommend your mother had part ownership of the house.

Either way there are issues. What happens if you were to divorce, one of you die and the other remarry, both die, she changes her mind or you change yours, you both died and your children wanted their inheritance, your mother wanted to leave part of her share to your siblings etc.

If your mother did this without security of part ownership, its a big leap of faith on her part if things do not work out as you expect for all these reasons.

If your mother was a part owner and needed care, the LA would at the very least want to place a charge on the house once her savings ran out and this could limit your freedom of action too.

FredTheFifth

Ok, thanks both.