Tenancy In Common

Holly_Kipper

Hi,

Hope someone can give me some advice.
My Mom and Dad have been advised to complete tenancy in common on their property to avoid paying for care.
Between them they have £77k of savings in joint accounts, ISAS, bonds and shares. Averages out to around to £35k each (Dad having more). Mom is going to need care which she is going to self fund obviously been over £23k. As we have no way of getting rid of money?
Now the tenancy in common could that be ....
50% Mom & Dad
25% myself
25% Sister

Will it benefit the situation in paying for the care? And would affect my Dad in the future?

I hope I have been clear enough of the situation and would be grateful on advice
Thanks.

Mojisola

When the one of a couple needs residential care and the other will stay in the family home, the value of the house is disregarded.

Pixie5740

Who gave your parents this advice? Dave from down the pub?

Age UK has advice for people who need or might need residential care. It would be a good place to start.

Holly_Kipper

Pixie,
What do you mean by that?
What is wrong with tenancy in common?
It would prevent my Mom and Dad loosing money in the house on care?

Mojisola

Holly_Kipper wrote: »

My Mom and Dad have been advised to complete tenancy in common on their property to avoid paying for care.

Now the tenancy in common could that be ....
50% Mom & Dad
25% myself
25% Sister

If your parents presently own their house as 'joint tenants', they can change their ownership to 'tenants in common' and both own 50% of the house.

They can't give away any portion of the house without deprivation of assets issues.

If they make wills, they can leave their half of the house to you and your sister (while giving their spouse a life interest so that they can stay in the house). This means that if the survivor of the couple needs residential care, only half of the value of the house can be used for care.

Have you looked at the different care home that are available for someone who is self-funding compared to where they might live if they are are being funded by the council?

As your mother needs care, make sure she is receiving all the benefits that she is entitled to. These help to pay the weekly bill.

cattermole

If your parent's gift half the property to you and your sister this would also be regarded as deprivation of capital/assets for care charging in the future should your father also require residential care. Local Authorities have increased powers regarding care charging now under the new Care Act and deprivation of capital/assets is covered in it.

Are you talking residential care for your mother or care in their home?

For the latter it would only be based on your mother's income and savings. The property value would not come into it.

While your father remains in the family home there is no power for the Authority to force a sale of take your mother's 1/2 of the property in care charges as referred to by other posters above.

In a nutshell the only benefit to being Tenant's in Common is if your mother dies because then she can leave her half to who she chooses.

There are also benefits to creating Property Trusts I suggest your parents seek proper legal advice. Also I am assuming in all of this that your mother has capacity, because if she doesn't then it will be very difficult to change anything.

Pixie5740

Holly_Kipper wrote: »

Pixie,
What do you mean by that?
What is wrong with tenancy in common?
It would prevent my Mom and Dad loosing money in the house on care?

I mean exactly what I asked, who has given your parents this advice? Are they in any way shape or form qualified to be advising on this? It's why I directed you to Age UK.

If your parents don't want to pay for their care using their money and assets who will pay for it?

Holly_Kipper

Pixie, I have come onto the forum for kind advice. Please don't be sarcastic I really don't appreciate it and it is not appropriate.


Everyone else:
I am currently caring for my Mom, she has full capacity. And we aim for her to stay at home, I am currently working full time and it has got a little to much for me with two young children therefore we have decided on help with her care, we plan for my Mom to stay at home with my Dad. It's just very unfortunate as no children or grandchildren have had inheritance of what was my Mom and Dads wish.

cattermole

Holly_Kipper wrote: »

Pixie, I have come onto the forum for kind advice. Please don't be sarcastic I really don't appreciate it and it is not appropriate.


Everyone else:
I am currently caring for my Mom, she has full capacity. And we aim for her to stay at home, I am currently working full time and it has got a little to much for me with two young children therefore we have decided on help with her care, we plan for my Mom to stay at home with my Dad. It's just very unfortunate as no children or grandchildren have had inheritance of what was my Mom and Dads wish.

Then really none of the issues you have bought up are an issue, once your Mums savings fall below 26k assuming Social Services agree to meet her care needs then she will get some help towards costs, once they fall below 14k then the savings will not be affected only her income will count towards care charging in the home.

It wouldn't necessarily be a bad thing to put the property in a "tenants in common between your parents" and for your mother to leave her half to you and your sister in a will. This half would then be protected in the future, should your father require residential care.

Unfortunately care has to be paid for and none of us can guarantee being able to leave all our money/property it to our children/grandchildren. so really their wishes don't come into it.

It really depends on how much extra care help your mother needs, it may not cost as much as you think and she will be entitled to claim Attendance Allowance which will help towards the costs. If it makes her and your father's life easier then using their money to fund good quality care is surely to their benefit and yours if it is putting a strain on you?

When my father was very ill (well dying basically) all I wanted was the best care for him, if that meant his money was spent that was what it was there for. We paid for 24/7 care at one point in the home, although my brother was more reluctant to do it than I was and he had an Enduring Power of Attorney but there was plenty of money to pay for his care from his savings alone, so it was paid.

It may also be worth them looking at the option of employing someone direct rather than using a care agency for all sorts of reasons, costs are one thing but also more continuity of care.

If you want any advice on employing a carer more than happy to help as this is my area of expertise.

Kynthia

Holly_Kipper wrote: »

Pixie, I have come onto the forum for kind advice. Please don't be sarcastic I really don't appreciate it and it is not appropriate.


Everyone else:
I am currently caring for my Mom, she has full capacity. And we aim for her to stay at home, I am currently working full time and it has got a little to much for me with two young children therefore we have decided on help with her care, we plan for my Mom to stay at home with my Dad. It's just very unfortunate as no children or grandchildren have had inheritance of what was my Mom and Dads wish.

You've still not confirmed whether the person who's given the advice is knowledgeable and qualified to do so. There are many implications to getting this wrong and the various options need to be fully explained to you and your parents.

For example if you don't already own a share in the property then you need to read about deprivation of assets. Do you know whether the property value will be counted while your father still lives there? Have you seen the difference in care with self-funding compared to council funded? Is interitence tax a consideration? What will be the effect of changing to TIC from JT If your dad should pass on before your mum and vis versa? Professional advice will cover many scenarios.

Pixie5740

I wasn't being sarcastic. I just asked a couple of pertinent questions (which you haven't answered) and directed you towards Age UK.