Selling half a property to pay for Care Home fees

Options
2»

Comments

  • Gavin83
    Gavin83 Posts: 8,751 Forumite
    Name Dropper First Post First Anniversary
    Options
    Pilsthedoeboy wrote: »
    Dad!!!8217;s will left his 50% share of the bungalow to my son and I as trustees under a Discretionary will trust.

    I'm assuming the property was owned as tenants in common and not jointly owned? I was always under the impression that a jointly owned property automatically passes entirely to the spouse although someone who knows more about wills might well correct me on this.
    Pilsthedoeboy wrote: »
    By the way, I!!!8217;m not trying to and but half the bungalow for a knock down price

    It does somewhat sound like it. :p
  • Spendless
    Spendless Posts: 24,151 Forumite
    Name Dropper First Post First Anniversary
    Options
    susancs wrote: »
    In regard to the market value of the property, when we had power of attorney over my husband's uncle's financial affairs and it needed to be sold so he could go into a care home, we had to get 3 different written local estate agent valuations on the market price. They were different so we were told to only accept offers in the range of the middle valuation as accepting the lower one could be seen as "deprivation of assets". The same advice was given when MIL had to go in a care home and owned half the house (other half owned by her son), which had to be sold.
    Whereas my Mum who sold my Grandmother's property last year to pay for care home fees, was told nothing like this. It was my Mum that held out for more money, the EA were pushing for my Mum to reduce the property. It never occurred to my Mum to take less so the home purchase was funded by the state sooner.
  • Tom99
    Tom99 Posts: 5,371 Forumite
    First Post First Anniversary
    Options
    The Valuation Office IHT manual sets out how to value a half share in a property, usually a 10%-15% discount on the half value, I would think you could use the same approach:

    http://manuals.voa.gov.uk/corporate/publications/Manuals/InheritanceTaxManual/sections/r-section_18/b-iht-man-s18.html
  • Keep_pedalling
    Keep_pedalling Posts: 16,641 Forumite
    First Anniversary First Post Name Dropper Photogenic
    Options
    Tom99 wrote: »
    The Valuation Office IHT manual sets out how to value a half share in a property, usually a 10%-15% discount on the half value, I would think you could use the same approach:

    http://manuals.voa.gov.uk/corporate/publications/Manuals/InheritanceTaxManual/sections/r-section_18/b-iht-man-s18.html

    The rules that apply to IHT are not applicable here. The OP would not be buying half a house, they are converting a 50% ownership into a 100% ownership. The only alternative if they cannot aford to buy her out,is that the whole property is sold and 50% of the proceeds go tho the OPs mother.

    Paying a discounted price is actually depriving the OPs mother of funds that she is very likely to need, and regardless of legalities is morally reprehensable. Her needs come before an unearned inheritance.
  • Pilsthedoeboy
    Pilsthedoeboy Posts: 10 Forumite
    Options
    Thank you to those of you who have made positive comments, it is appreciated. To those who haven!!!8217;t been so kind suggesting that I don!!!8217;t want to use my own money or to not act in my mum!!!8217;s best interest, you obviously don!!!8217;t know me and I have found some comments quite harsh and hurtful tbh.
  • Gavin83
    Gavin83 Posts: 8,751 Forumite
    Name Dropper First Post First Anniversary
    Options
    Pilsthedoeboy wrote: »
    Thank you to those of you who have made positive comments, it is appreciated. To those who haven!!!8217;t been so kind suggesting that I don!!!8217;t want to use my own money or to not act in my mum!!!8217;s best interest, you obviously don!!!8217;t know me and I have found some comments quite harsh and hurtful tbh.

    I was being helpful. Expect the LA to ask for lots of evidence and go through this extremely carefully. If the paperwork isn't in order it's likely they'll include 100% of the property value in their calculations.

    If they are only considering 50% I think your question has been answered satisfactorily.
  • Cheeky_Monkey
    Cheeky_Monkey Posts: 2,072 Forumite
    Options
    Pilsthedoeboy wrote: »
    Thanks, fully understand what you are saying. Acting in my mum!!!8217;s best interests with or without the POA is at the top of my agenda. I know that Mum would be happy us living in the bungalow as would my late father would have been, rather than just sell the bungalow on the market with half the money paying mum!!!8217;s fees. Thats the thing here, The LA will look to Mums half to pay fees so obtaining the best price will only mean potentially more money for the LA and less money for my wife ! Of course if it comes to it we will fight the LA to try and get the best price for us, who wouldn!!!8217;t in these circumstances ? Still I don!!!8217;t get this valuing half a property on the open market for what a willing buyer is prepared to pay ( part of the means test ) - can anyone advise ?

    It would appear not!
This discussion has been closed.
★ ★ ★ Meet your Ambassadors

Categories

  • All Categories
  • 343.2K Banking & Borrowing
  • 250.1K Reduce Debt & Boost Income
  • 449.7K Spending & Discounts
  • 235.3K Work, Benefits & Business
  • 608.1K Mortgages, Homes & Bills
  • 173.1K Life & Family
  • 248K Travel & Transport
  • 1.5M Hobbies & Leisure
  • 15.9K Discuss & Feedback
  • 15.1K Coronavirus Support Boards