Dad has Dementia. Best course of action to protect assets?

stancrom

Not sure this is the right category but here goes... Looking for high-level guidance on the following please. Will have to consult an IPA/solicitor eventually, no doubt...

• My parents are approaching 80, my mum is fit and well but my dad has deteriorated badly with vascular dementia over the last year. It is likely he will have to receive support/care at some stage in the not too distant future 
• They live in their own home but have an outstanding mortgage on it (<£20k remaining). They have been paying the interest only over that time and the outstanding loan balance has remained
• They have had barely any savings and have struggled financially living off my mum's pension for a good 20 year or so. My dad was self-employed before his business folded in the 1990s and believed he had not contributed sufficient NI stamps to qualify for a pension of any kind 
• Recently it has come to light (very long story) that he was actually entitled to a state pension and it had been treated as a deferred pension as the letter sent by the Dept of Pensions was not replied to at the time (13 years ago when he reached pensionable age). The reason for this was that my parents moved in with my grandfather around the same time - clearly the DoP letter had gone to the old address and was not forwarded by the new owner. My dad has recently received a lump sum (about £75k) for this - better late than never I guess...
• Due to my dad's recent deterioration, LPA has been applied for in the last couple of weeks 
• My mum intends to use some of the funds to pay off the mortgage as a first step. The deeds of assent are not yet in my dad's name but 'Representatives of (his father)'. It was an ex Council house which my grandfather bought under Right to Buy and on his death in 1993 (and my dad's business failing around the same time) my parents took on the outstanding loan and moved in. On settlement of the outstanding loan, my mum assumes that the deeds can then pass into my dad's name (and her's ideally?) following the usual process through solicitors (as an aside, the deeds were thought to be held by a firm of solicitors who have since dissolved, so my mum is unclear on how this issue gets resolved although she is enquiring about this herself) 
• The question - with all the above in mind - is basically what might be their best approach to protecting their assets (property and the remaining lump sum) should my dad require care at some stage, I am unclear what means-test qualifying 'assets' may be considered in that instance? I would love my parents to be able to spend their newly-acquired cash enjoying themselves in later life rather than having it taken away, after having had a tough time over the last 25 years or so, but think the time for that has probably passed (at least for my dad)
• Any comments/advice much appreciated....TIA

eskbanker

stancrom said:
The question - with all the above in mind - is basically what might be their best approach to protecting their assets (property and the remaining lump sum) should my dad require care at some stage, I am unclear what means-test qualifying 'assets' may be considered in that instance? I would love my parents to be able to spend their newly-acquired cash enjoying themselves in later life rather than having it taken away, after having had a tough time over the last 25 years or so, but think the time for that has probably passed (at least for my dad)

Who would 'take it away'?  If your father has capital then the expectation is that he'd use it to fund his care rather than relying on the state to do so (beyond some basic provisions), and if he tried to conceal it or dispose of it in some way then that would typically be regarded as deprivation of assets.  The marital home wouldn't be considered when assessing care funding if either of them is still living there:

https://www.ageuk.org.uk/information-advice/care/paying-for-care/paying-for-a-care-home/do-i-have-to-sell-my-home-to-pay-for-care/

Apodemus

I'm sorry to hear of your father's condition.  I would focus on getting a good PoA organised for your mum and on making sure that as much of your Dad's assets are registered in joint names as possible. 

You also need to seek good advice on whether paying the mortgage off completely is in their best interests.  Your folks may be better off with a split of cash and regular outgoings (such as mortgage payments) rather than no cash and no outgoings.  CAB may be able to help with this.

macman

You say that they have 'hardly any savings', then that he has received 'a £75K lump sum'?
How long has the mortgage left to run? As you say, the priority must be to repay the capital due at end of term, without which your parents will not have a roof over their heads.
I'm also unclear who currently owns the property, or to whom it is registered at the LR?

elsien

You are in England? 

Does he still have capacity to complete a power of attorney or are you looking at deputyship? 

Who is being named as the deputy - at their age it should not just be your mother. Is she setting up a power of attorney for herself as well - she would be wise to do so. 

If dad has care needs, have you looked at attendance allowance? Has he had a care needs assessment?

Any care he needs would be subject to a financial assessment but that doesn’t mean they can’t do holidays and all the usual things that people spend their money on. And the aim would be to keep him at home rather than having to go into care. Mum can have a carers assessment of her own needs as well, and it may be that things can carry on ticking along with support coming in. 

NottinghamKnight

Someone with severe dementia may have care costs covered by the NHS, my father is currently in this position but in Wales; another poster on a thread reported the same for her father which I believe was in England.

sparkiemalarkie

Apply for reduced council tax 
https://www.moneysavingexpert.com/reclaim/severe-mental-impairment-dementia-council-tax-rebate/

Keep_pedalling

As his attorney anything you do with that money has to be for his his benefit alone, it does not give you the right to protect a future inheritance. Paying off the mortgage would be a perfectly legitimate use of the money as it seems they have no other way of paying it off so would risk losing their home at some point in the future.

While your mum lives there the house will be disregarded as far as care costs are concerned.

You should investigate whether your father can claim attendance allowance, which is not means tested which will help pay for care.

Does your father have a recent will in place?

xylophone

The deeds of assent are not yet in my dad's name but 'Representatives of (his father)'.

Who are  the Representatives?  Do you mean the Administrators of your grandfather's estate?

Your father and mother?

If the property is actually registered at the Land Registry (is it?), then the paper deeds are of only historical interest. If they still exist in paper form, they are likely to be held by the mortgagee. The mortgagee holds a first charge on the property?

As your parents are now in a position to repay the mortgage, no doubt they will do so to secure a roof over  their heads.

It seems that your father still has capacity (despite his illness) ?  The house is going to be registered as tenants-in-common? Each parent is to make a will leaving his beneficial  share in an interest in possession trust to the other with you (siblings?) as remainder men?

With regard to the balance of the arrears of pension, perhaps it would be better split into a sole account in the name of each parent.

This seems to me perfectly legitimate as your parents have survived on only your mother's pension (s) over the last twenty years.

If your father needs means tested care then his personal assets will be taken into account.

The marital home will not be assessed in the means test while the spouse is still living in it.

Albermarle

is basically what might be their best approach to protecting their assets

If you hide assets to deliberately try and avoid paying for care ( and letting the council pay ) you can get into trouble and end up having to pay anyway , so it is not recommended .

csgohan4

There's not much in shielding assets from future care home fees. Would you rather they be in a grotty care home or they actually used their own assets to enjoy their final years?