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MIL moving in with family and possible care home fees/expenses in future(12 Posts)
MIL and BIL are selling both properties and MIL buying house with BIL's family - the idea is they will take care of her in her old age so she doesn't have to go into care. MIL has early onset dementia, but personally I think she can understand the impact of what she's doing.
Nothing's set in stone, but I think she wants to put roughly half of money into the house and BIL will keep this on her death. The other half she wants to divide between her four other children now. Obviously a couple are not happy with this as they don't think their being treated fairly especially as they do help MIL with things! Putting that aside, I'm concerned about what happens if BIL is no longer in a position to look after her (he's the least healthy of all her children so you never know), or he has financial problems and house needs to be sold. Also, if she's given all her other money away, there may be very little left to help her - only one family earns above the average wage so now could be the time to pay off mortgage, have a few treats for the rest of us.
I've talked to her about this and begged her to see a solicitor before going further. I said they advise what's best for her, not anyone else, but she just said I know what I want to do and I'm not listening to a solicitor. She might never be forced into care, but me (and DH agrees) we want to know she's protected.
We can't make her take advice, but does anyone know how she'd stand worst case scenario if she needed extra care or support. Would a solicitor choose to advise her if he was concerned about the impact/implications of this, as she'll need one for the house sale.
I have never Legal experience.
But could you talk to her from another angle? Get her to consult with a solicitor to protect both her and BIL. Say to her "what if BIL becomes ill or can no longer care for you? Surely you want to protect him so that his home doesn't need to be sold to pay for your care home fees? Speak with a solicitor so that the money you've invested in BIL's home is seen as his rather than your asset".
She really needs a solicitor, if they do go ahead with this proposal and if her health deteriorated and had to go into care she could be made to sell her share of the house to pay for it.
What they are proposing could be classed as Depravation of assets. People who do this think if the house isn't in their name then they can't be made to sell to pay care home fees. They can and often are forced to pay.
They also have the mistaken belief that if seven years have past since the change of ownership they don't have to sell.
The seven year statute of limitation only applies to repayment of outstanding taxes.
If she does need care (either carers visiting at home, or going to a care home for respite or longer) then the general advice is that if she goes ahead with this sort of financial arrangement, the local authority will consider it deliberate deprivation of assets (giving money to your family now to avoid having enough money to pay care fees later). There are rules about how much money she can give each child each year, a solicitor can help with that. I'd advise looking into getting power of attorney drawn up while she's still able to do so.
As an aside, I'd advise against the plan bit just because of the financial stuff, but because in my experience, the early stages of dementia can be really difficult, and this living arrangement that's being proposed may only be workable for a short time. It's a lot of upheaval for uncertain gain.
IIRC the authorities go back into your financial records for 7 years so if she is going to need care in the next 7 years, then it's too late to shift money around in this way I'm afraid.
Check out the caring for elderly parents chat- they are founts of knowledge and very helpful.
I am in the same boat as you, though my Mum is now more than early onset. She was diagnosed with that 2 years ago. We were advised to definitely not try and sell off her assets or move money over to me.
Basically what ThinkingBlonde says
All her assets will be taken into account for the purposes of care home fees. This will include the house unless the other owner of the house is considered to be a dependant/vulnerable/over the age of 65
Any attempts to get rid of cash to relatives beforehand will be considered deprivation. Local Authorities will pursue this, through the courts if necessary.
The 7 year thing does not apply. They can go back as far as they need to if there is reason to believe assets were disposed of specifically to avoid paying care fees.
Even if the money has 'gone' e.g gifted to pay off mortgages etc then the financial assessment will be carried out as if it is still in MIL's bank account and the assessed fee will still be applied. Someone will have to pay it.
If you google " 'MIL's local authority' financial charging for residential care " it should take you to a webpage or pdf produced by the relevant council which will explain their specific policy.
They need professional advice before proceeding any further.
I think we could be in a similar position in a few months. I think my MIL wants to do it for company and also so she can have the pleasure of her children benefiting in her lifetime. I guess the authorities would see if differently.
So can I ask, if someone sells their house and gives cash to some family and then invests the rest in joint ownership of a property with another family, would the authorities insist the property was sold to pay for nursing care if that was the only asset? Would the authorities be chasing the other members of the family who received cash? This latter element worries me, as those that receive cash are likely to pay mortgages off, maybe spend a little of it and it may not be there in 3/4 years time.
The danger here is to your BIL - he could find himself forced to sell his home.
This absolutely does require legal input. There are ways of spreading the assets without the LA being able to reclaim them but you need proper planning. The danger is that a property is very tangible for a LA to go after.
The local authority will consider MIL to still be responsible for the care fees she would have had to pay had she not given the money away.
How MIL/family choose to pay this would be up to them, but someone would ultimately have to pay it. Unpaid care home fee bills are considered just the same as any other debt, so even if it seems horrible taking elderly people to court over it local authorities increasingly have little choice but to do this as their funding has been slashed by central government.
My sister has done something similar, signed her house over to my nephew and niece, who have bought a bungalow between them which my sister and her DH live in. The original house is rented out and the money from that pays the mortgage on the bungalow.
It caused a big fall out among her other family, my other niece is quite clued up and advised them not to do it but they did it anyway.
My bil has poor health, he is 80, (I am a lot younger than them) I can foresee trouble ahead
Agree with other posters above this will be treated as deprivation of assets if she needed local authority care of any kind. Legislation now says they can look back 15 years I think to see what MIL assets were and what happened to them (there would be a paper trail). She would be treated as still owning the assets and would have intolerable stress as they would then persue the assets to try and recover them from whoever benefited. She just can't do this even if she wants to. She can obviously move into a property with her son but she should be wary of putting so much money into his home as he could be forced to sell. Perhaps he can buy and she can pay 'rent' then would still have her assets in her name if needed. And if they are never needed for social care can then distribute them equally between children as the resident son would have been compensated with rent in the meantime!
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