Buying my Grandmothers home.

maccaz21

Hi there.

Bit of background.

My grandmother has dementia and didn't sign her property over to my Mother and Auntie (M+A) before she went into a care home.
They do have full POA.

My Gran's house was valued at £40k when she went into care.

M+A renovated the house at their considerable expense so it can be rented out, with the money going towards the care costs.

The council have sent a bill for £40k and an idea is to sell the house now. (should have sold it at the time IMO).

I'm the grandchild and want to buy the house and keep it in the family. My M+A were born and raised there.

My dear old battleaxe isn't going anywhere soon. She's physically fit as can be for 90 odd.

Question are;

In the deferred payment scheme, do the council have the right to send this house to open auction?

As the POA, are my M+A allowed to sell this house to anybody they choose in a normal house sale (me)?. Then obviously use the money to pay the council's bill.

Can the council revalue the house after work has been paid for by M+A and claim more equity from the house? That wouldn't seem right to me.

Thank you

Mac

AnotherJoe

maccaz21 wrote: »

Hi there.

Bit of background.

My grandmother has dementia and didn't sign her property over to my Mother and Auntie (M+A) before she went into a care home. It wouldnt have made any difference
They do have full POA.

My Gran's house was valued at £40k when she went into care.

M+A renovated the house at their considerable expense so it can be rented out, with the money going towards the care costs. Well, as we discover later on they made a mistake by not loaning her the money they used to do that.

The council have sent a bill for £40k and an idea is to sell the house now. (should have sold it at the time IMO). Well, if nan hasnt got £40k thats their tough luck. She is IIRC allowed to keep a certain amount, is it about £23k. So the most that would need paying is £17k unless Nan has other savings?

I'm the grandchild and want to buy the house and keep it in the family. My M+A were born and raised there. You can of course buy it.

My dear old battleaxe isn't going anywhere soon. She's physically fit as can be for 90 odd.

Question are;

In the deferred payment scheme, do the council have the right to send this house to open auction? Only if Nan doesn't pay up. Maybe she has £50k elsewhere? (i know, ha hah)

As the POA, are my M+A allowed to sell this house to anybody they choose in a normal house sale (me)?. Then obviously use the money to pay the council's bill. Yes, as long as they dont for example sell it for 10p to a relative. I suggest they get a few independent valuations and you buy it for that much.

Can the council revalue the house after work has been paid for by M+A and claim more equity from the house? That wouldn't seem right to me. The house should be sold for what its worth. The fact that (say) its got (say) an extra £10k value because M+A spent £10k fixing the roof is to a large extent tough luck unless they can claim it was a loan and expected to be paid back and they can make that claim stick

Thank you

Mac

What M+A "should" have done was loan £10k to Nan, so that when the house was sold that £10k came to them first before council got it.

My suggestion is to pay them back the value of the house sale plus nans savings minus whatever Nan is allowed to keep ?23k?, minus whatever was spent, claiming that was a loan and let the council push back.

elsien

Under the power of attorney M & A have an obligation to act in your grandmothers best interests. That means if they sell the house, getting the best price for it. They cannot sell it to you at a discount. They would need to get valuations to confirm a fair current market price was being paid as it is now, not at the point she went into care.

That is a different issue to the deferred payments - the council aren't going to force an auction. They just need their bill to be paid. But selling the house cheaply to keep it in the family is not in your grandmothers current financial best interests. M & A can sell the house to you if they wish, as long as they do it properly.

AnotherJoe

elsien wrote: »

Under the power of attorney M & A have an obligation to act in your grandmothers best interests. That means if they sell the house, getting the best price for it. They cannot sell it to you at a discount. They would need to get valuations to confirm a fair current market price was being paid as it is now, not at the point she went into care.

That is a different issue to the deferred payments - the council aren't going to force an auction. They just need their bill to be paid. But selling the house cheaply to keep it in the family is not in your grandmothers current financial best interests. M & A can sell the house to you if they wish, as long as they do it properly.

Interesting ethical point there. Suppose its in Nans best interests NOT to get the best price but to get her granddaughter the house at the lowest possible price. Thats what she'd have wanted, yes? After all the attorneys dont have any obligation to the council

Only kidding .... sorta but yes i agree the council will come after them if they dont get what seems like a reasonably fair price.

maccaz21

Thanks for that.

Good idea about the loan.

Im annyoyed at the council. When it was valued at £40k mother wanted to sell it to the family at the going rate. They were told by the council that it doesnt work like that and it must go to auction for the highest bidder.. I wasnt really into this at the time. But since they received £40k bill. Im looking and cant see how they have the right to do that. M+A are POA

About financial best interests and ethics.

I make no bones about it. At this stage, the less the council get the better.
£700 a week is an unbelievable cost..

Gran had £15k in the bank, that went years ago. Pension, rent and another allowance goes straight to care home and it atill eats away at the house. If she knew this she would be furious the house isnt going to her daughters.. these sort of costs were unheard of in her day. You sign over the deeds and that was it.

I know I cant buy the house for £2. The thoughts is to pay around £60k, M+A get there money for renovating and the council get their money.

Going forward its a case of Gran being financed by the council like all the other people who didnt have a bought home.
Albeit, the got around £50k from her first

Cakeguts

maccaz21 wrote: »

Thanks for that.

Good idea about the loan.

Im annyoyed at the council. When it was valued at £40k mother wanted to sell it to the family at the going rate. They were told by the council that it doesnt work like that and it must go to auction for the highest bidder.. I wasnt really into this at the time. But since they received £40k bill. Im looking and cant see how they have the right to do that. M+A are POA

About financial best interests and ethics.

I make no bones about it. At this stage, the less the council get the better.
£700 a week is an unbelievable cost..

Gran had £15k in the bank, that went years ago. Pension, rent and another allowance goes straight to care home and it atill eats away at the house. If she knew this she would be furious the house isnt going to her daughters.. these sort of costs were unheard of in her day. You sign over the deeds and that was it.

I know I cant buy the house for £2. The thoughts is to pay around £60k, M+A get there money for renovating and the council get their money.

Going forward its a case of Gran being financed by the council like all the other people who didnt have a bought home.
Albeit, the got around £50k from her first

You are going at this from the wrong angle. Gran has a sum of money tied up in a house. She has to live somewhere. She can't live at the home she has now so she has to sell that just like anyone else would who wants to move to pay for her new home which happens to be a care home but it is her home and it is her money that she is spending on herself to live there. If Gran runs out of money society as in the tax payers in her local council will help her out by paying for her to carry on living in her current home. However those tax payers often have their own elderly relatives that they have to help pay for too so your Gran is very lucky that if she runs out of money other people in your community will pay for her through their council tax or income tax.

In order to help the other people in your community pay for your Gran and in order for the money in her house to be spent on her the people with POA have to get the best possible price for the house so you can't just decide how much you would like to pay for it. The people with POA have to get it properly valued so that your Gran gets as much as possible for it after all it is her money.

So the first thing that has to happen is that Gran's house has to be professionally valued. Once that has been done you have to pay the value for it not just what you think it is worth.

marliepanda

I love how signing over houses is considered normal practice in the first post... woops forgot to sign the house over before I needed to pay for my care...;

Those who did remember pitch a right fit when their relative goes into care or dies and they have to pay council tax with no probate/care home exemption because guess what, you own it not your dearly departed!

elmer

Been right there Marlie Panda

elmer

betsie

I don!!!8217;t see how the council can just ask for £40k? Did your ban still have savings when she went into the home?
She is allowed to keep £14,250 so this would come out of any money she receives for the house before anything is paid over (unless the POA!!!8217;s have spent this money whilst she has been in the home?).
You are also allowed to pre pay a funeral plan (this isn!!!8217;t considered deprivation of assets). The remainder would then be payable to the council - if this is under £40k you would defo need good evidence to show you got market value for the house, if over £40k you would have to pay the bill and tell them how much savings she now has as they take a small% of this extra (over the £14,250) each month. If she ends up with more than £23,250 she would have to pay the full fees till her money goes down to this amount.
If you want to also repay the POA!!!8217;s for money they spent on the house they will need to have all the receipts and a fully supported lists of costs. If they do this can also be repaid first before the council.

silvercar

Why have the council sent a bill that equates to the value of the property? The bill from the council should be for the costs of care. Even then Gran is allowed to keep some savings.

Flugelhorn

silvercar wrote: »

Why have the council sent a bill that equates to the value of the property? The bill from the council should be for the costs of care. Even then Gran is allowed to keep some savings.

Unless the council think that there is a lot more money somewhere - who knows?