Care Home Funding

[34duck]

Good day all,
I`m trying to help my ex sort out what appears to be a bit of a minefield regarding funding for her mothers care.
Mother had lived in a bungalow that was mortgage free and half owned by herself and the other half owned by her daughter. Ten years ago mother signed the other half of the property over to her daughter and moved out. Daughter then took out a mortgage for £90k and put £35k towards a warden assisted flat for mother.
Ten years on and mother has had to go into a care home.
Daughter fully understands that something will be treated as her mothers asset but is unsure as to what the local authority are actually able to work out. As things stand they do not want to pay anything and the care home are threatening to terminate her placement. So far £25k of mothers savings have been used to fund the care but now there is nothing left.
The flat is currently for sale but Santander will not allow a second charge to me made on it becuse the is £40k outstanding on the mortgage (no payments have been missed). The local authority want the second charge on the property to guarantee the money goes to them. Its all getting a bit awkward and although there is no attept to deny them the money there is the worry that she will get turned out of the home if no more payments are made soon.
Does anyone have any views on this situation.
Many thanks,
34duck

[bruncher]

I have been through similar issues with both parents. There are many variables that make it difficult to give a simple answer. Is the care home resident receiving medical / nursing care? If so, I doubt the home could turn her out, although they may try to transfer her to hospital if they can. I would urge seeking legal advice and direction on the specific circumstances, as there is enormous pressure on families to pay for care even when there is entitlement to financial help. Sadly, local authorities will pay attention to a solicitor's letter when they may ignore a communication from a regular citizen.

[CryptoPlankton]

Good day all,
I`m trying to help my ex sort out what appears to be a bit of a minefield regarding funding for her mothers care.
Mother had lived in a bungalow that was mortgage free and half owned by herself and the other half owned by her daughter. Ten years ago mother signed the other half of the property over to her daughter and moved out. Daughter then took out a mortgage for £90k and put £35k towards a warden assisted flat for mother.
Ten years on and mother has had to go into a care home.
Daughter fully understands that something will be treated as her mothers asset but is unsure as to what the local authority are actually able to work out. As things stand they do not want to pay anything and the care home are threatening to terminate her placement. So far £25k of mothers savings have been used to fund the care but now there is nothing left.
The flat is currently for sale but Santander will not allow a second charge to me made on it becuse the is £40k outstanding on the mortgage (no payments have been missed). The local authority want the second charge on the property to guarantee the money goes to them. Its all getting a bit awkward and although there is no attept to deny them the money there is the worry that she will get turned out of the home if no more payments are made soon.
Does anyone have any views on this situation.
Many thanks,
34duck

Hi 34duck

I don't think it is necessarily the case that the LA can treat it as her mother's asset at all. They need to be sure that giving her half of the house away was a "deliberate deprivation of assets" and should consider two things:

a) She must have known at the time she got rid of her property that she needed or may need care and support.

b) Avoiding paying for care must have been a significant reason for giving away her half of the home.

As it was ten years ago, if the mother was fit and healthy, could she reasonably have been deemed to be expecting to need care and support? The LA need to have clear reasons for deciding that is the case and their decision is open to challenge. As bruncher says, I would consider seeking legal advice, but maybe have a look at this Age UK page first, which includes downloadable factsheets and a phone number for free advice:

https://www.ageuk.org.uk/information-ad ... of-assets/

One last thought: if your ex happens to be over 60, I don't believe they can consider the property as an available asset anyway...

Good luck.

[PinkDalek]

...
I don't think it is necessarily the case that the LA can treat it as her mother's asset at all. ...

I think 34duck is talking not only about the Mother's half of the property that was given away 10 years ago, which you've covered, but also the warden assisted flat, which the Mother appears to own and is on the market.

[CryptoPlankton]

...
I don't think it is necessarily the case that the LA can treat it as her mother's asset at all. ...

I think 34duck is talking not only about the Mother's half of the property that was given away 10 years ago, which you've covered, but also the warden assisted flat, which the Mother appears to own and is on the market.

Doh, it's like I read something completely different - I blame the heat! Anyway, sorry about that.

It is a tricky one, but it should be possible to come to an arrangement for deferred payment as far as the warden assisted flat is concerned. Again, I would suggest visiting the Age UK site in the first instance:

https://www.ageuk.org.uk/information-ad ... -for-care/

(Factsheet at the bottom of the page.)

[DrBunsenHoneydew]

Can Santander really refuse a second charge? This suggests a special type of mortgage is in place - such as a flexible mortgage that allows further borrowing. I'd find out what's causing the blockage here and switch to a different mortgage product if possible.

[melonfool]

Well, my advice would be to reduce the asking price of the flat so it sells. You could even reduce it to the amount of the mortgage outstanding. These things are in high demand so it's odd it's not sold quickly.

Makes no difference to you at all how much it realises as long as the mortgage gets paid. Once the money is there, however much, it all goes to pay for care and once she gets to the lower savings limit the LA picks it up, so just bargain basement it!

Mel

[beeswax]

Well, my advice would be to reduce the asking price of the flat so it sells. You could even reduce it to the amount of the mortgage outstanding. These things are in high demand so it's odd it's not sold quickly.

Makes no difference to you at all how much it realises as long as the mortgage gets paid. Once the money is there, however much, it all goes to pay for care and once she gets to the lower savings limit the LA picks it up, so just bargain basement it!

Mel

Yes that is pretty good advice as it really does make no difference what price you get as the LA will take the lot except the statutory limits which are around 25K top end 15K lower which are tapered. She will also have to pay them any pensions she gets and disability benefits and if she did need care and you are fully funding I would expect her to get some benefits like attendance allowance and so make sure she does get that..But as I said if the LA arranges the contract and they are liable for the costs, they will take everything they can. My MIL gets the statutory 24 pounds a week and that is all she is allowed to keep from her pensions, late husbands pension and anything else she got. Very generous from MP's who claim thousands for themselves.

My cousin was told they must sell their Mothers house asap even if it meant reducing the price which they did. The money then pays for the care costs until the statutory limits kick in and then the LA start contributing. It depends on the care home whether she stays or not. Some care homes don't have LA contracts and so when the money dries up, she will have to find a care home where the LA have contracts with them and many do. Its best to get them involved now just in case and so they are legally obliged to carry out a financial assessment anyway. They also know which ones have vacancies and BTW look at the Governments Care Quality Assessments online which they are legally obliged to do in every care home. All are rated by them.

Many or even most care home require a top up payment from a third party and needs to be considered as some don't. And you have the right to assess any care home to see if it meets Mothers needs both in terms of carers and nurses but somewhere within reasonable travelling distance for relatives. ie you cannot insist on it being in the same town or area..

AFAIK you cannot defer any payments ie keep the property UNLESS another relative lives there. You can't just move in and do that. eg Wife goes into care and Husband lives in the house and so it cannot be sold in that situation but if its in equal names, that payment ie her assets can be deferred until he no longer needs it.

Most care home are now asking 800-1000 pounds a week in my area and so the money will soon run out. The moral is to spend it while you can and enjoy life while you can. That is why many elderly people are selling their property in one of those equity schemes that allow you to live there until you die and then they sell the property. That sounds a great idea in some ways as the money is no good when you are gone although kids/relatives may have a different view?

[JonE]

BTW look at the Governments Care Quality Assessments online which they are legally obliged to do in every care home. All are rated by them.

By all means look at them but place no trust in them without further research: the practice is not quite what the proclaimed theory might lead one to expect.

One needs to do more background research because an establishment with a dreadful record can just change its name or 'formal' ownership to start afresh with a clean CQC record (and no link to the history of the establishment) - and it can take quite a while before it receives its "first" inspection in its new incarnation. Inspections generally are not necessarily conducted as frequently or rigorously as they might be - there is rather too much self-assessment for the liking of some people.

A Which? survey last year found that 27% of homes failed to display their ratings on their website (as legally required) or else made them very difficult to find. The sector is rife with financial shenanigans, the CQC remains ineffective and whistle-blowers do not receive the protection they should. Be careful out there - very careful.

Cheers!

[CryptoPlankton]

AFAIK you cannot defer any payments ie keep the property UNLESS another relative lives there.

Funnily enough, I believe it is actually the opposite of that: the eligibility criteria for a deferred payment agreement include "there should be no-one else living in the property who needs to stay there, such as a spouse, partner, dependent child, a relative aged over 60, or someone who is sick or disabled" *. The property is disregarded in the means test if qualifying relatives live there, which is slightly different.

But, anyway, it seems the main stumbling block here is the difficulty in getting a charge on the property. I'm not even sure selling it for peanuts for expedience is the answer as the LA should assess property at its present market value when including it in a means test (less any mortgage and less 10% of its value for expenses). I'm sure there's anecdotal evidence for various outcomes and it's a bit of a postcode lottery, but I'd certainly try to keep a dialogue open with the LA - in the end, surely it's in their interests for the mother to contribute as much as she is able and, therefore, to realise best price for the flat. I'd still talk to Age UK who will benefit from drawing on far more experiences than we have here.

* https://www.moneyadviceservice.org.uk/e ... -term-care