Selling house to pay for care?

x_toonangel_x

Hello,

Hoping somebody can shed some light as google gives a few different answers..

Here is the situation, my Grandma & Grandad have lived in the same house since they were first married, they brought up both their children there. My Grandad died 6 years ago & my Grandma is now facing going into care after a few health issues & upon recommendation from the hospital.

My Grandma wants the house to stay in the family. My husband & I are currently renting a house nearby (we have two small children) & her house would be ideal for us.

I understand the current 'rules' are that if you have assets over 23,250 you are responsible to pay for your own care. She has around 19k in savings and the MV of her house is approx 110k.

My question is - the savings she has won't last very long as care is very expensive & my husband & I cannot currently get a mortgage as his company recently went through insolvency due to being taken for a lot of money (70k) last year.

If we rented the property from her, could she use that money toward her care? (which would be around £590 a month according to a calculator I used online) my concern is that even with that income each month & her savings, it wouldn't go very far.

Are they likely to force her to sell up? Anyone who's experienced this or knows more about it, please help x

Red-Squirrel_2

Would you be paying market rent?

Your grandmother would have all the legal and tax responsibilities of any other landlord, would that be of benefit to her?

Would it not be better for her to keep it simple, sell the house and use the proceeds for her? There will be other houses you can live in.

AdrianC

x_toonangel_x wrote: »

My Grandma wants the house to stay in the family.

A noble aim, but one that needs tempering with financial reality.

I understand the current 'rules' are that if you have assets over 23,250 you are responsible to pay for your own care. She has around 19k in savings and the MV of her house is approx 110k.

So she has around £129k in assets. That is a lot more than £23k.

If we rented the property from her, could she use that money toward her care? (which would be around £590 a month according to a calculator I used online) my concern is that even with that income each month & her savings, it wouldn't go very far.

It won't even scratch the edges of her care costs, so her debt to the council will be building up rapidly.


It might be that the council will allow her to continue owing the shortfall indefinitely, but that debt will come due on her death. Her estate will still contain the value of the property. How would her executor (you?) plan to repay the debt then, without selling the property?

HampshireH

Look into care homes. Unfortunately many cost over £1k a week and thats not even for the best ones.

Your gran needs to be somewhere is ideally wants to live in or at the very least is 100% comfortable. Care homes do vary a lot in their standards of car and facilities. Have you looked into where she may be going and assessed the costs.

seven-day-weekend

x_toonangel_x wrote: »

Hello,

Hoping somebody can shed some light as google gives a few different answers..

Here is the situation, my Grandma & Grandad have lived in the same house since they were first married, they brought up both their children there. My Grandad died 6 years ago & my Grandma is now facing going into care after a few health issues & upon recommendation from the hospital.

My Grandma wants the house to stay in the family. My husband & I are currently renting a house nearby (we have two small children) & her house would be ideal for us.

I understand the current 'rules' are that if you have assets over 23,250 you are responsible to pay for your own care. She has around 19k in savings and the MV of her house is approx 110k.

My question is - the savings she has won't last very long as care is very expensive & my husband & I cannot currently get a mortgage as his company recently went through insolvency due to being taken for a lot of money (70k) last year.

If we rented the property from her, could she use that money toward her care? (which would be around £590 a month according to a calculator I used online) my concern is that even with that income each month & her savings, it wouldn't go very far.

Are they likely to force her to sell up? Anyone who's experienced this or knows more about it, please help x

She has to pay the care home bill. How she does this doesn't matter. It's just that most people can't afford it without selling their homes.

If she can raise enough money from rental income and other resources, (savings, pensions, benefits etc), then she will not have to sell her house. From what you have said, however, it does not seem that she will be able to raise the required amount.

I knew one old lady who could fund her care home place from rentals, savings and income and another one who could do it entirely from income.

lookstraightahead

You could possibly move in with her and be her carer. Otherwise yes she needs to sell her asset to pay for her care.

PasturesNew

Are there others that have been asked?

How many children did she have? How many grand-children?
How much are the fees, could everybody "club together" until a buyer among you is sorted out? Is there a buyer among you now that could buy it?

gettingtheresometime

One other issue is that should you rent from her, when your gran eventually dies, the house will form part of her estate which could result in you becoming homeless.

AdrianC

gettingtheresometime wrote: »

One other issue is that should you rent from her, when your gran eventually dies, the house will form part of her estate which could result in you becoming homeless.

Why would that be?

[Deleted User]

You do realise that £590 per month care costs sounds very very low? Its not much more than renting a property, and yet will also need to allow for staffing costs, food, heating etc. I am afraid it will probably cost more.

Mojisola

x_toonangel_x wrote: »

If we rented the property from her, could she use that money toward her care? (which would be around £590 a month according to a calculator I used online) my concern is that even with that income each month & her savings, it wouldn't go very far.

She will have her pension, probably higher rate Attendance Allowance and your rent and could draw down from her savings.

Add that up and then compare the total to the price of a decent care home in her area and see how long her money would last. How soon would you be able to get a mortgage?

Does anyone have Power of Attorney for Grandma? It wouldn't be fair for her to have to deal with all the legal responsibilities of being a LL.

Could you pay the rent from your income? You may have problems getting benefits to help with the rent with this arrangement.