Care Home Fees where house in sole name

pandakins99

Hope you can help with my query


My parents are in their mid 70s, and sadly my Mum has dementia. I can see a time when she will need to have residential care.


My parents have been married for 50 years. They have lived in their present house for 24 years. They separated in the late 1980's and sold their house and business. Two years later they decided to get back together. My Mum had spent a lot of the proceeds of sale, but my Dad still had a lot of his. Dad was working freelance, while Mum had a good income for a mortgage. Mortgage borrowing was were tricky then.


My Mum stipulated that she would go ahead and buy the house under her sole name, but Dad would provide much of the deposit. It was something like deposit from Dad 35%, deposit from Mum 15% and 50% mortgage paid by Mum. The house is still in her sole name.


There was a Declaration of Trust in respect of my Dad's initial contribution but it remains her house. The mortgage is now paid.


What worries me is that he could be forced out of the house if care home fees were needed. They have a modest house in an expensive area, and 35% of proceeds would not be enough to buy anything. The rest of the family are 100s of miles away. When it comes to it, I'd want the best care for Mum, but I worry about Dad being put on notice by an 'official' to vacate.


They had a 'tenants in xxxxx' arrangement, but it was the 'lesser one'.


Any advice would be appreciated

Mojisola

pandakins99 wrote: »

What worries me is that he could be forced out of the house if care home fees were needed.

If one of a couple needs residential care and their partner will still be living in the house, the value of the house is not taken into account when the financial assessment is done.

Your Dad will not be forced out of his house.

Useful reading - https://www.ageuk.org.uk/home-and-care/care-homes/paying-for-permanent-residential-care/
and - http://alzheimers.org.uk/?gclid=CL2SwZqu4b8CFc3HtAod7hEAQQ

Mr_Toad

Absolutely agree with Mojisola, the value of the property will be disregarded.

Errata

Mojisola wrote: »

If one of a couple needs residential care and their partner will still be living in the house, the value of the house is not taken into account when the financial assessment is done.

Your Dad will not be forced out of his house.

Useful reading - https://www.ageuk.org.uk/home-and-care/care-homes/paying-for-permanent-residential-care/
and - http://alzheimers.org.uk/?gclid=CL2SwZqu4b8CFc3HtAod7hEAQQ

Does this mean that a spouse who is a tenant in common - say 50/50 - and needs residential care would not have that share taken into account even if the value of the property was half a million, not uncommon in London? And a charge would not be put on the property, payable at death or sale of property?

74jax

Errata wrote: »

? And a charge would not be put on the property, payable at death or sale of property?

I understood it as a charge wad put on the property , maybe things have changed.

Mr_Toad

Errata wrote: »

Does this mean that a spouse who is a tenant in common - say 50/50 - and needs residential care would not have that share taken into account even if the value of the property was half a million, not uncommon in London? And a charge would not be put on the property, payable at death or sale of property?

The house is not taken into account, they do not force a partner out of their home.

With tenants in common if each owns 50% they still don't apply a charge because getting the money is all but impossible because nobody would buy 50% of a house and they can't force the other party to sell simply to release their funds.

This situation doesn't resolve itself when both partners die because the 50% owned by the other partner is willed to family who also can't be forced to sell.

However, if the property is sold at any time then the local authorrity will get their money but not before.

A charge is usually only an option when a single person with their own home goes into care and the family want to try and keep the home. Nobody knows how much care a person will need so you may find yourself in the position where you've sold a parents house and have £500,000 in the bank and the parent in care only lives a short while and the family have essentially sold the house unnecessarily.

Opting to have a charge on the house means that if the above happens the family will often raise the money in another way and keep the house, if the person in care lives for a long time then the house will have to be sold to cover the costs.

It all seems very complicated but essentially it isn't. If care involves a married couple the house is disregarded.

I've been through it all with my parents. My father went into care for dementia and mum kept the house even after Dad's money ran out and he became local authority funded.

margaretclare

Errata wrote: »

Does this mean that a spouse who is a tenant in common - say 50/50 - and needs residential care would not have that share taken into account even if the value of the property was half a million, not uncommon in London? And a charge would not be put on the property, payable at death or sale of property?

Is there any difference between e.g. title held as joint tenants or as tenants in common? Just as a matter of interest.

When my first husband and I moved here, back in 1990, title was solely in my name, mortgage in my name, because he was uninsurable etc because of state of his health. He died 18 months later. I was left with the mortgage.

Mojisola

https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/301250/CRAG_34_April_2014.pdf
Section 7
Specifically 7.003

It doesn't matter whether one of the couple owns the house or whether the house is owned as tenants in common or joint tenants.

Errata

Mojisola wrote: »

https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/301250/CRAG_34_April_2014.pdf
Section 7
Specifically 7.003

It doesn't matter whether one of the couple owns the house or whether the house is owned as tenants in common or joint tenants.

Still clear as mud, so let's take a hypothetical.
Spouse 1 moves into residential care, only assets are state pensions and any benefits, and 50% ownership of a £1million property (quite possible in central London), value of property is disregarded when LA undertakes their financial assessment and LA funds their placement. Spouse 1 dies.
Spouse 2 continues to live in property which they have 50% ownership of but property is sold when they move out to wherever, and they spend their share of the profit on dancing girls or toyboys. Or they die and their 50% share is bequeathed by them to whoever.

Does the LA then recover the cost of funding Spouse 1.?

Mojisola

Errata wrote: »

Still clear as mud, so let's take a hypothetical.
Spouse 1 moves into residential care, only assets are state pensions and any benefits, and 50% ownership of a £1million property (quite possible in central London), value of property is disregarded when LA undertakes their financial assessment and LA funds their placement. Spouse 1 dies.
Spouse 2 continues to live in property which they have 50% ownership of but property is sold when they move out to wherever, and they spend their share of the profit on dancing girls or toyboys. Or they die and their 50% share is bequeathed by them to whoever.

Does the LA then recover the cost of funding Spouse 1.?

Not under current rules.

Errata

Mojisola wrote: »

Not under current rules.

There's no wonder LA's are skint and unable to properly fund those who wish to stay in their own homes with LA support.