Care Home Fees - Split ownership of house

1catfamily

HI. Hope I've popped this in the correct area? 

Mum and Dad were tenants in common and when she passed her 50% was shared between my sister and I. Therefore Dad owns 50% and we have 25% each. We are nearing the time when Dad will need a care home due to dementia and I want to be clear on my options with the house.

If I understand correctly, we could refuse to sell our share and so his share becomes valueless for the financial assessment. If we do this I assume that we then can't sell the house until he passes away otherwise the money becomes accessible by local authority? Would we be able to rent the house out and give him his 50% share each month? If so, can we still expect him to pay half of any upkeep on the property?

All sounds so callous putting it like this but I'm just exploring options. 

sammyjammy

Do you have Power of Attorney to make decisions for your dad relating to finances?  If not you would need to apply to the court to take any actions on his behalf.  You can refuse to sell the house which will probably mean a charge for the cost of the fees being put on the property.  

There are no your options, there are three of you with an interest in the property and all need to be considered, if your Dad can't do that for himself someone else needs to (formally).

born_again

1catfamily said:

HI. Hope I've popped this in the correct area? 

Mum and Dad were tenants in common and when she passed her 50% was shared between my sister and I. Therefore Dad owns 50% and we have 25% each. We are nearing the time when Dad will need a care home due to dementia and I want to be clear on my options with the house.

If I understand correctly, we could refuse to sell our share and so his share becomes valueless for the financial assessment. If we do this I assume that we then can't sell the house until he passes away otherwise the money becomes accessible by local authority? Would we be able to rent the house out and give him his 50% share each month? If so, can we still expect him to pay half of any upkeep on the property?

All sounds so callous putting it like this but I'm just exploring options. 

Not sure that it works like that. The value is what they asses it as, not what it's resale value is.
Also remember that if you get your way, then the choice of care homes will be very limited & may not be somewhere you would care to leave your father in 🤷‍♀️

Rodders53

From reading these forums the Council will place a charge on the home, with interest added (for Dad's half) for when it is sold.  No avoiding those fees.

BUT do you and he want him to be in the cheapest Care Home possible or have something better from his hard earned asset? 

Are you sure you two already own half --- usual is to place it in a life interest trust... otherwise you'll be liable for Capital Gains Tax on your share(s) (but not Dad as he lives there) when it is sold.

I'd suggest that it's probably best to sell sooner rather than later and that renting is not for the faint hearted with the latest rules and regulations (unless you are already Landlords of other properties.)

1catfamily

sammyjammy said:

Do you have Power of Attorney to make decisions for your dad relating to finances?  If not you would need to apply to the court to take any actions on his behalf.  You can refuse to sell the house which will probably mean a charge for the cost of the fees being put on the property.  

There are no your options, there are three of you with an interest in the property and all need to be considered, if your Dad can't do that for himself someone else needs to (formally).

Yes sister and I have both finance and health POA in place

elsien

Waiting until he dies isn’t going to work because then authority would put a deferred payment plan in place and recoup the money once the house is sold. 

Yes, you could rent the house out, but I’m not sure what the point would be if you’re planning to sell it when he passes away anyway because it’s just kicking the can a little bit further down the line and it’s not going to avoid him having to pay towards his own care costs. 

And as his powers of attorney acting in his best interests, I would suggest you properly look into being landlords, what it means,  any costs of bringing the house up to scratch, and cost to him from bad tenants causing damage or stopping paying rent with court processes to get them out.  If the money you spend out on his behalf is going to be more than what you potentially could be bringing in then you shouldn’t be going there. 

Just be aware of any conflicts between his best interests and your interests and how are you would resolve those. 

Keep_pedalling

It would be rather cruel of you to try this, selling the house gives your father greater choice about his care and anyway the LA are definitely going to put a charge on the house to recover the fees when it is eventually sold. You would certainly not be acting in his best interests doing this.

Renting the property out may sound attractive, but being a landlord comes with a whole heap of responsibilities so unless either of you are experienced landlords this should be avoided. 

Are you sure you own 25% rather than your mother’s share of the house being held in a life interest trust? if you do the CGT may be an issue for you when it is sold. 

Spendless

Why would you refuse to sell the house, for what reason? If your parents had been joint tenants and everything passed to your Dad on your Mum's death, you'd now be looking at all the money from the house sale potentially going in care home fees (depending on value, care home costs and your Dad's remaining lifespan) instead 50% goes to his care which will very likely make a difference to choices he can have whilst you and sis gain what was your Mum's share.