Person going into care home thinks they have avoided selling their house to pay fees?

I haven't heard this story but generally if you are dodging inheritance tax you can't keep physical control of the assets. If you transfer a house to your child you need to pay rent or move out.

I seem to remember Princess Margaret transferred her villa on Mustique to her son and he promptly evicted her, not sure it true though

I think you’ve answered my question. If there is a disregard, they can’t force you to sell the house to pay care fees after the person in care has died ? Is that correct ?

Provided it’s a close relative, they have no other home and they were resident before the person went into care. The house will then be disregarded but the LA will check periodically to make sure circumstances haven’t changed - eg, the person has moved out or died.

His house is safe if a relative over 60 is living there

Posters often mention ‘council run’ care homes, but AFAIK there are precious few of those left.

My self funded DM was in an excellent, specialist dementia, purpose built CH run by (AFAIK) not for profit Abbeyfield. I would guess that maybe half the residents were council funded (subsidised by the higher fee self funders). They all enjoyed exactly the same facilities, en-suite rooms, etc.

I can only say i was 60 when my dad went into care, i had always lived with my parents it was my home.My parents had a tenants in common arrangement when my mum died i inherited her share so i owned half the house legally. So as well being over 60 i co owned the house.Now you cant sell half a house can you,who would buy it.the very unpleasnt social worker dealing with my dad going into care did try and threaten me with all sorts,she even accused me of neglecting and ill treating my dad because i stated and he agreed,luckily my dad had all his marbles,i couldnt look after him i adored my dad,im an only i loved him to bits id bever have hurt a hair on his head,he was a lovely man.She had to apologise in end.she knew it was a load of crap but say my dad had had demenia and wasnt of sound mind what would have happened then. Youve got to be prepared for the authorites to try all sorts.

Your aunt needs to do tenants in common so cousin
legally owns half the house.That makes it far harder to for them to do anything about taking the house. I sold ours when my dad died and moved to city i worked in where retired i still live.

If the house is eligible to be counted as care fees and a deferred payment agreement is made, then a charge is put on the property to allow the LA to recover charges at such time as the house is sold. It’s my understanding that if the house is disregarded then no charge is put on the property so there’s no mechanism for recovering fees. Not sure it’s that simple though.

Yes mother and daughter, when they both became widowed they decided to buy a place together. It does sound very similar to your situation, although Aunt still definitely owns her own share. And yes, makes you think, if she died and left her share to my cousin (which is the intention) then if my cousin decided to sell, what might happen? I wonder if the person from the local authority who was giving advice earlier might come back to the thread and say if they'd ever heard of that?

Can I just ask, when you say Aunt and Cousin are they mother and daughter ? If so she definitely qualifies as a close relative and being over the age of 60 will mean the disregard is mandatory. I assumed that a deferred payment agreement had already been arranged, but I’ve just re-read and it appears that your aunt has not yet gone into care, so it’s important that you get clarity before that happens, as once a DPA is arrange and a charge is applied, it would be difficult to put right.

I’m in a similar situation. I live with my mum - co owned a property with her and my late husband since early 2000s. She signed her share of the property over to me after my husband died in 2017 - partly because she was getting on (she’s now in her 90’s) and didn’t want to be bothered with the day to day running of the household and partly because she wanted security for me as I was on my own. In the event that she has to go into care I doubt Social Services would disregard our property simply because she signed it over to me - whatever the reasons behind it they would probably view it as deprivation of assets. But I’m 65 and disabled, so no charge would be applied as long as I’m resident here and don’t sell up to downsize. Still not sure what would happen if I sold on if she passed away after entering care - hoping someone a bit more knowledgeable than me will be along to advise.

It’s the other way around apparently. Tenants in common offers more protection because it divides the home into agreed defined shares and gives the shareholder more say in who inherits their share of the property instead of it passing naturally to a joint tenant.

Thank you @Rosscameasdoody that seems to make sense. Definitely need to look into it further. I think elderly people are often given the wrong advice by LA/hospital staff etc then it becomes “the law” in their minds 😞

The disregard is applied so that vulnerable people are not made homeless by the sale of the home. So it applies to a spouse still living in the home, a dependent child, a close relative over the age of 60, or disabled, or a carer who has given up their own home to care for the person. So your cousin qualifies for the disregard in her own right if she is over the age of 60 and this is her only home.

It sounds like a deferred payment agreement has been arranged in error - this is effectively a loan from the LA to cover fees until the house is sold, and the LA will apply arrangement fees and interest. She should make enquiries before the charge is applied, but things to bear in mind are that the disregard only applies to the original property, and there will be ongoing checks to ensure continuing eligibility. So if she dies, or moves out for any reason the house will be assessed for care fees and a charge applied. If she sells up to downsize, your aunts’ 50% share will be assessed for care fees, and if your aunt agrees to any part of that share being used to buy another property, any unused funds will be assessed for care. I don’t know if the LA would have any claim to recover fees if the house was sold after the person in care dies - don’t see how they could if no charge was placed on it, otherwise what would be the purpose of the disregard.

@BorgQueen tenants in common. She’s had some advice from Age Uk but I’m not sure how accurate it is 🤔

According to Age UK, it shouldn’t be considered, BUT, it doesn’t sound like your cousin is dependant on your Aunt.
Are they Tenants in Common?
If so then your Aunt’s half might be assessed.

If they jointly own then I really don’t know, your cousin needs proper advice.

So if someone goes into care but they co-own the house with another elderly relative then the local authority can’t put a charge on the house at all? What if the house was then sold at a later date? I’ve got an aunt 90+ living with my cousin who is 70+; if aunt goes into a care home my cousin says she’s been told they will charge 2% interest from that date until she sells up so she thinks she’ll need to sell
very quickly. I don’t know where she’s got this from but she is adamant.

Anyone moving in would still have to be vulnerable according to the exemption conditions though - the exemptions are there to stop potentially vulnerable people becoming homeless as a result of the sale of the home, and the rules are strict. A deferred payment option also has its’ drawbacks. There are arrangement fees and interest is applied to the loan, which reduces the funding pot for the person in care. And when that person dies, the LA expect the care bill to be settled within 90 days. I expect there’s some leeway when the funds can only be realised from the sale of the home, but it’s still a lot of pressure to be put under, potentially at short notice.

'The end' not 'the ned'. I really should go to bed.

I wonder if coming to the ned of a tenancy agreement qualifies as 'homeless'? I was just thinking this as there is such a mad scramble for rentals at the moment, so many landlords selling up. A lot of families are really in crisis when it comes to housing, why shouldn't they live in a relative's empty home? A deferred payment option might be a good idea.

If the relative qualifies for an exemption, then they can still move in to the home after the person goes into care, but there must be a good reason - for example that they would be homeless otherwise.

The rules specify that it must be a close relative of the person going into care, either over the age of 60, under the age of 18, or disabled. They must also have occupied the home before the adult went into care, and it must be their only home. The reasoning behind it is so that a vulnerable relative wouldn’t be made homeless by the sale of the house. The LA’s have the power to disregard a property into which a qualifying relative has moved after the person enters care, but they would have to have a sound reason for doing so, and if they’re found to have made themselves intentionally homeless in order to benefit, the property won’t be disregarded and they would have to apply for a deferred payment agreement.

Age UK have an excellent fact sheet on funding care. It answers most of what’s been asked here.

If it’s at the point that a care home is needed, I imagine the council taking a very dim view of their family moving in, even at full rent it’s unlikely to cover care fees.
If they’d been living there for years it would be different.
Can’t see it being ok but proper advice is needed.

Just wondering about these rules. If a child of the homeowner, ie the elderly person needing care, is renting privately but decides to move into the house with their children for a better quality of life, and one of those children is registered disabled, does that count as an exemption? (ie a grandchild). Or does it have to be the disabled, adult child of the homeowner?

Yep, you can also get a disregard for a a close relative over 60, or with a disability, a dependant child under 16 cared for by an occupier of the home, and for a carer who gave up their own home to care for the person going into care. The circumstances are regularly assessed so if circumstances change the house will become available for assessment - for example if the qualifying occupier moves out or dies. And the disregard only applies to that particular home, so if it’s sold to allow the occupier to downsize, any remaining unused funds from the sale would be assessed for care fees. Not sure whether the LA could claim fees back if the home is sold once the person in care dies, given that there is no charge attached.