Mum wants to transfer house ownership. I'm on ESA

obvious

So, my mum owns her home outright and wants to sign it over to my sister and I for 'estate planning' reasons. Honestly, she's worried that if she has to go into care in the future (no sign of that!) that the government will take her house. It's a modest property worth not much more than £100K.

I'm on income related ESA support group and will I imagine be migrated onto UC in due course.

My initial thought is to ask her not to sign anything over to me as I'm assuming it would instantly end my entitlement to ESA?
I own (outright) and live in my own separate home.

My second thought is that even if she 'signs her home over' to my sister (who's in full time employment) that it wouldn't protect her in the way she imagines anyway?

Thanks :-)

calcotti

As far as your benefits go if your mother is over state pension age the house she lives in can be ignored even if you own or part own it. If she isn’t it can’t and your benefit entitlement ends if you have capital over £16,000.

However should your mother need care in the future she may be considered to have intentionally deprived herself of capital and be treated as still having it. https://www.moneyadviceservice.org.uk/en/articles/means-tests-for-help-with-care-costs-how-they-work#getting-rid-of-assets-to-avoid-paying-for-care

gettingtheresometime

obvious wrote: »

So, my mum owns her home outright and wants to sign it over to my sister and I for 'estate planning' reasons. Honestly, she's worried that if she has to go into care in the future (no sign of that!) that the government will take her house. It's a modest property worth not much more than £100K.

I'm on income related ESA support group and will I imagine be migrated onto UC in due course.

My initial thought is to ask her not to sign anything over to me as I'm assuming it would instantly end my entitlement to ESA?
I own (outright) and live in my own separate home.

My second thought is that even if she 'signs her home over' to my sister (who's in full time employment) that it wouldn't protect her in the way she imagines anyway?

Thanks :-)

As it stands your mum has an asset that she can use to fund any care costs she may have, thus giving her the choice of standard of home she goes into....ignoring any deprivation of assets consideration.

If she wants to be left at the mercy of the local authority, then she should look further into gifting her home but otherwise she should be actively discouraged from following this course of action

xylophone

Your mother has the intention of deliberately depriving herself of an asset in order to avoid care home fees.

http://www.payingforcare.org/deprivation-of-assets

baza52

why would you not want your mother to get the best care she can afford towards the end of her life rather than you having a few quid to spend and your mum getting basic care?

obvious

baza52 wrote: »

why would you not want your mother to get the best care she can afford towards the end of her life rather than you having a few quid to spend and your mum getting basic care?

You're right, thanks. I was just going to just stick a pillow over her face and book a cruise or 2 but I've seen the light :-)

jewelly

obvious wrote: »

You're right, thanks. I was just going to just stick a pillow over her face and book a cruise or 2 but I've seen the light :-)

Good to see a bit of humour on here. Thanks for that.

elsien

Aside from the deprivation of assets, your mother should also think through all the ramifications:
If you/your sister at some point in the future get divorced/become bankrupt then the house would be considered an asset and may have to be sold. You and your sister would be liable for all the maintenance costs. And possibly a few other things I haven't thought of. All of which could end up with her having to leave and go into a rental property. Is that really what she wants?

Ames

elsien wrote: »

Aside from the deprivation of assets, your mother should also think through all the ramifications:
If you/your sister at some point in the future get divorced/become bankrupt then the house would be considered an asset and may have to be sold. You and your sister would be liable for all the maintenance costs. And possibly a few other things I haven't thought of. All of which could end up with her having to leave and go into a rental property. Is that really what she wants?

I could be wrong, but I think they'd also be responsible for things like annual gas safety checks, as they'd be her landlord. They'd need landlord's insurance and all that kind of thing.

happyandcontented

baza52 wrote: »

why would you not want your mother to get the best care she can afford towards the end of her life rather than you having a few quid to spend and your mum getting basic care?

I didn't read any suggestion of that in the OP, quite the reverse.

bspm1

baza52 wrote: »

why would you not want your mother to get the best care she can afford towards the end of her life rather than you having a few quid to spend and your mum getting basic care?

Rather judgemental don't you think.

Personally, if possible, the best care to give any elderly relative is care for them yourselves, not always possible I know but also not something that needs a property sale to pay for.