Care home fees after inheriting 50% of property

pinkshoes

Dementia is a tough one.

One option would be have her live with you and employ a nurse for however many hours you'd need. It's tough looking after someone with dementia though. 

I don't see the issue with paying for care. At least when you have money to pay you get care options. My gran didn't have that luxury. She was widowed in her early 30s, lost the house (no such thing as mortgage protection insurance then) and then any equity was spent on paying rent. When she got dementia she needed to eventually go into a care home. As she had no assets and barely any savings, then our options of state funded care homes were very limited so we ended up having to pay ourselves so she could stay nearby. 

I'd suggest taking a mortgage out to buy her out of her half of the house, then putting the money in a savings account to pay the care home. It's difficult to know how long someone with dementia will live. 

sjl_elbac

Just updating what I have found out which might help others looking for answers:

I have visited my bank regarding taking out a mortgage to buy my mother's share of the house. They advised me that if my name was on the land registry for the property then this would be possible, but he thought that as it involves a trust it probably wouldn't be possible to get a mortgage as my name wouldn't show up on the registry. He advised me to ask the probate solicitors.

 

So I wrote to our solicitor and they confirmed the banker's understanding as shared with you below:

 

"The property will be held with your mum owning 50% of the house and you as the Trustee of the Will Trust holding the other 50%. The trust allows your mum to live in the property for the rest of her life and requires the permission of both of you to be sold.

As the property will be held 50% by your mum and 50% by the Trustee, legally it won’t be owned by you in your sole capacity but as a trustee of your dad’s Estate. The papers I have drawn up to transfer the property make this clear.

As you are the sole beneficiary of your dad’s Estate, when your mum passes away you will then become the owner of his 50% of the property once the trust is wound up. The 50% of the house owned by your mum would then be passed according to her Will.

As such, I am unable to raise funds to pay the carehome fees and the case will need to go back to the local authority to sort out.

Spendless

sjl_elbac said:

Just updating what I have found out which might help others looking for answers:

I have visited my bank regarding taking out a mortgage to buy my mother's share of the house. They advised me that if my name was on the land registry for the property then this would be possible, but he thought that as it involves a trust it probably wouldn't be possible to get a mortgage as my name wouldn't show up on the registry. He advised me to ask the probate solicitors.

 

So I wrote to our solicitor and they confirmed the banker's understanding as shared with you below:

 

"The property will be held with your mum owning 50% of the house and you as the Trustee of the Will Trust holding the other 50%. The trust allows your mum to live in the property for the rest of her life and requires the permission of both of you to be sold.

As the property will be held 50% by your mum and 50% by the Trustee, legally it won’t be owned by you in your sole capacity but as a trustee of your dad’s Estate. The papers I have drawn up to transfer the property make this clear.

As you are the sole beneficiary of your dad’s Estate, when your mum passes away you will then become the owner of his 50% of the property once the trust is wound up. The 50% of the house owned by your mum would then be passed according to her Will.

As such, I am unable to raise funds to pay the carehome fees and the case will need to go back to the local authority to sort out.

Well I'm sure someone will be along who understands more than me but what if the LA take the view you not being able to get a mortgage on the property isn't their problem and the house can be sold, because that just needs the permission of both of you to be sold  and you can give your Mums permission as you have LPA. It may not be enough to just refuse.

Your Mum's will won't be relevant if she owes her whole share  to the care home, the debt will be taken from her estate if not settled before.  

sheramber

So you do not own any of the house. i- 50% is owned by the trust and 50% is owned by your mother.

Should you not be paying rent to live there?  Your mother's share of that rent would go towards her care fees.

Rambosmum

If you can't raise a mortgage on the property for whatever reason (and it sounds like you currently can't) then there are two options:

- sell the property in its entirety (rather than your mothers half)
- Enter in to a DPA

If you do the latter then you get to remain in the house, and once your mother dies, you will be able to raise a mortgage on the property and buy her half of the property to settle the debts on behalf of her estate. 

You will not need to sell your dads 50% to ay your mums fees IF you enter in to a DPA. 

If you do not enter in to a DPA then you risk a forced sale of the entire property (50% of the value of which will go in to trust for you and your children) - the other 50% will go to your mother and fund the care home. 

Once your mum dies, if the care home fees make up MORE than her estate (the 50% value of the home plus any savings she has) then the rest of the bill will be met by the LA AND the person who signed a third party top up agreement (IF one was signed). 

Rambosmum

And technically you should be paying 50% market value rent. (or 100% of which 50% goes to your mum and 50% to the trust).

lisyloo

sjl_elbac said:

Just updating what I have found out which might help others looking for answers:

I have visited my bank regarding taking out a mortgage to buy my mother's share of the house. They advised me that if my name was on the land registry for the property then this would be possible, but he thought that as it involves a trust it probably wouldn't be possible to get a mortgage as my name wouldn't show up on the registry. He advised me to ask the probate solicitors.

 

...................................

As such, I am unable to raise funds to pay the carehome fees and the case will need to go back to the local authority to sort out.

"probably wouldn't be possible" is not a definitive answer. Your high st bank may not be interested but it is possible to get a mortgage on a property in trust. It's more niche and specialist and you'll need to look further than a high st bank.

Why don't you want to go down the DPA route, given that the alternative is that your home is sold? Are you just playing for time? They may take their time but due to the size of the bill they aren't just going to write it off.

BungalowBel

The care home bill has to be paid.  If your mother can pay it without using the equity from her share  of the house, then do that.

If she can't, then she will have to sell her share.  If you are in a position to buy her share, then fine, do that.  If not, then the whole house will have to be sold, and you have your share  of the equity, and she hers.  Whichever way it is done, she can then use her money to pay the care home.

lisyloo

BungalowBel said:

The care home bill has to be paid.  If your mother can pay it without using the equity from her share  of the house, then do that.

If she can't, then she will have to sell her share.  If you are in a position to buy her share, then fine, do that.  If not, then the whole house will have to be sold, and you have your share  of the equity, and she hers.  Whichever way it is done, she can then use her money to pay the care home.

I don't think it's necessarily the case that it has to be sold.
DPA's are sometimes available for this reason.
I took one on my mother-in-laws behalf as her deputy during the sale process. The local authority prepared the paperwork to put a charge on the property.
As I've said from the start they may prefer a DPA where they know eventually they will get their money and maybe not have to wait that long (average stay in care home is around 2 years) rather than spend a lot of money going to court and forcing a sale.
If it was me I'd be dealing with it and either looking for the right mortgage or asking for a DPA.
High st banks are not a great place to go for advice.