Mum buying a house with us

[Futurethinking2026]

My DM currently owns a home with DSF, he sadly isnt likely to be around too much longer. DM isn’t getting any younger either but doesn’t have any immediate health concerns and her mum lived to a very good age so hopefully will be around for a while yet.

We currently rent as we don’t have enough savings for a deposit (long other story) but can comfortably afford a mortgage.

If DM was to sell her house, use the proceeds to pay a deposit on a house for us all to live in (with us getting a mortgage for the rest). What would happen in the event of her needing a care home at any point in the future? This doesn’t look likely right now or have any signs that she will but ultimately she’s 70 now and no one knows the future.

The simple thing is to own the new home as tenants in common.

If you own the home as joint tenants this means that you each own the whole home jointly, like a joint bank account. But if you own it as tenants in common then you each own a specific percentage.

This is often done by married couples and the split is an equal 50/50. But you don't have to split ownership 50/50, you can do it any way that you want.

So, for example, if your mum put in a 20% deposit and then you are solely paying the 80% mortgage then you might look to split the ownership of the house 80/20 for example.

"What would happen in the event of her needing a care home at any point in the future?"

On current rules, they would look at her income (including pensions and benefits) and her capital.

The capital rules vary between England, Wales and Scotland but, basically, in England if she has over £23,250 in capital then she will have to pay all care home fees until her capital drops below this amount.

The rules are likely to change quite a bit next year though.

One good thing about doing this is that if you (or your DH if you're married) turn 60 before she goes into care then the value of her share of the house is not counted at all (provided you're still living in the house). They will just count any savings or other assets that she has.

If you and DH are under the age of 60 when she goes into care then her share of the value of the house will be counted as part of her capital.

So if the home ownership is split 80/20 then they will work out 20% of the value of the property and say that is how much your mum's share of the house is worth when they decide if she has more than £23,250.

Your mum won't be forced to sell her share of the house, but the money will be taken when the house is sold or she dies, whichever happens first.

But, as I say, the rules are meant to be changing quite a bit next year about how much you have to pay.

Although I don't think they're changing the rules about capital so they will still disregard the value of the home if you're over 60 and just work on the percentage owned if you're under 60.

PP is incorrect.

By current rules if you are buying together in good faith and she has no current need for care if she later requires a care home she cannot be made to sell her share of a property because you own part of it and are living there. Regardless of your ages.

Different story if you're not living there eg if you moved out as it wasn't working.

I'd go tenants in common with her leaving her share to you if she dies and you and your DH leaving to each other. You can be a party of 3 in the tenants in common if you wanted.

Also Labour cancelled the care cap so no changes in the pipeline unless they think up a new plan.

I think there are far more issues you are not considering beyond the needing care part. I would head over to the elderly parents board and have a read of some of the issues. As you currently don't live together and probably haven't for some time this could be a huge can of worms. Plus you are also putting this onto your partner too and possibly your children if you have them. You can be ill without needing a care home.

I have not lived with parents but both my Mum and MIL went through cancer and chemo and the horrendous side effects like vomiting and diarrhea which they were thankful they could do in the privacy of their own home, I wouldn't have wanted my children to see their Grandma that poorly. My friend moved her Mum in post op and she never moved out and I saw the strain on my friend's marriage over her Mother's behaviour, feeling like she was still able to dictate things to her daughter. My other friend grew up with his Grandad living with them which was fine until the Grandad got dementia.

https://www.mumsnet.com/talk/elderly_parents

We briefly considered this when we wanted to move house last year, and MIL wanted to downsize after being widowed. We had seen a few houses with 'granny annexes', but out of our own price range.
I'm so glad we did not go ahead, as it would have meant ME eventually ending up as her carer, despite MIL having a daughter (who only visits her once a year). I know that sounds uncaring but we don't have a close relationship, and she is wealthy enough to pay for whatever help she might need.
It would also would cause difficulty after her eventual death, as we would be left with a house that's too big, which we would have to sell to pay SIL her share of inheritance.

What hasn't been mentioned here is the consideration of your future mortgage company. If she is going to be living there and paying the deposit, some companies will require her to be named on the mortgage. It does open a can of legal worms this one as she has a financial interest in the property. You'll need to consult with a solicitor and mortgage broker.

@conniefromaccounts

You appear to have misunderstood what I said.

"...if she later requires a care home she cannot be made to sell her share of a property because you own part of it and are living there. Regardless of your ages."

You will notice that I said:

"Your mum won't be forced to sell her share of the house, but the money will be taken when the house is sold or she dies, whichever happens first."

The reference to the ages of the OP was concerning the capital disregard and here their ages are very important indeed.
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"Also Labour cancelled the care cap so no changes in the pipeline unless they think up a new plan."

Thanks for that, I wasn't aware that the cap had been cancelled. It doesn't surprise me though given what else they have done.

These are definitely other considerations we need to look at and consider. These questions were more from a legal, would we need to sell the house type of view.

Thank you.

@Another2Cats
They can't take the money when the property is later sold!

I bought a place with my parents. A large home that is basically semi-detached but not. They were early 60s and made sense for a variety of reasons. I've always lived with extended family in close proximity, in eachothers houses so nothing new and it works brilliantly.

However, we did need a mortgage on the property. Despite being early 60s and dad still working, we could not get a mortgage with all of us. We worked with a broker but it was either a flat out no or completely unaffordable. In the end parents had to gift us everything they were putting into the house and sign to confirm it was a gift and they have no claim.

Me and my partner legally own everything and could kick them out at anytime. I also have siblings and their inheritance is tied up in the house atm. We will be buying parents out of the house fully in the next few years so hopefully wont be an issue and siblings couldn't do anything anyway as legally they don't have a leg to stand on so we could cut them out. We had lots of conversations, going in very open and transparent but always a worry mixing money and family.

That said, its working brilliantly for us. I love being able to support parents, they have an amazing bond with my kids and I am fully prepared for the caring responsibilities when the time comes.

Yes they can. That's the whole point of doing it!

In the OP's case, if she or her DH are over 60 when the mother goes into a care home then the capital value of the mother's share of the house is disregarded in the financial assessment.

If neither of them are over 60 then the mother's share of the house is counted as part of her capital.

The mother will not have to sell her share of the house immediately but can apply for a Deferred Payment Agreement with the Council (depending on how much she has in savings).

When this happens, the Council put a charge on the property (like when you get a mortgage or secured loan).

With having a charge on the property, this means that if it is every sold then the Council will be repaid it's money.

On the mother's death, her share of the property is part of her estate and the charge on it is a debt of the estate. It is then down to the executors how they pay off the debt.

Thank you for sharing this. Definitely something for us to consider then as we would need to the mortgage for sure.

Thanks, we definitely wouldn’t want to sell on her death. If it’s years away then would hopefully be able to ‘buy her out’ but not in the immediate future.

You also need to consider what happens if your and your DH split up.

Another alternative would be to take out a whole of life insurance policy on your mum for the amount that she is putting in as a deposit.

So, for example, if your mum is contributing, let's say £80k as a deposit (just a random number) then the absolute maximum that the council should be able to claim is, I think, £65,750. The lower threshold limit below which there is nothing to pay for care home fees is currently £14,250 (80,000 - 14,250 = 65,750).

But the Council will also be able to claim interest on the outstanding amount, so it might be slightly higher.

So, in this particular example, a life insurance policy of £70k for your mum would pay off the maximum debt payable to the council.

You would need to work out the exact figures based on your own circumstances.

From there, you need to look at how much that might cost.

Getting a quote for whole of life insurance can be really difficult. It's usually those dodgy "Over 50s Life Insurance" companies that you see advertising on TV.

Another alternative, instead of taking out a life insurance policy, is to put the equivalent amount into an ISA, or something similar, every year.

You know that mum is going to pass away eventually and, if she does go into a care home before you or your DH get to 60, then those fees will eventually come out of her share of the house (although they will stop if she is still in a care home when either of you reach the age of 60).

Think about what you can afford to put away every month after you have paid the mortgage and other bills and what you spend normally to maintain a reasonable standard of living.

If you put this regular monthly savings into something like a stocks and shares ISA then this will grow tax free over the years.

You will then either get to the point where one of you hits 60 before your mum goes into care. At this point (unless the law changes) you know that your mum will not be charged any fees for a care home and everything you've saved can be spent on whatever you want to spend it on.

In contrast, if your mum goes into care before either of you reach 60 (or, again, if the law changes) then you know that you have already saved a lot towards the total bill that you might face in the future.

These are just a couple of suggestions off the top of my head. A qualified advisor would likely be able to provide you with the best advice.

That’s fair and not one I had considered.

Really helpful, thank you

Do you have any siblings?
I guess not because this is pretty much cutting them out of any inheritance.

What happens if you and DH part ways? Worth getting that water tight so you don't end up having to sell while your DM is still alive and living with you.

How committed are you to caring for your DM? It's very likely, and hard to imagine/predict how people change as they get more elderly & infirm, anxiety & depression can be a factor which is not always considered.

Is there enough family space so your children can enjoy their home in the future when your DM does start declining and her care starts to dominate family life?

Not being too negative I hope because I assume you can appreciate all the benefits, just may not have considered all the pitfalls!

Thanks, the only one of these that I hadn’t considered was if me & DH split up as mentioned about.
All the rest will take a lot of serious though and investigation but this post was purely around the financial and legal side as if it’s not feasible then I don’t want to go down the next rabbit hole of is it right for our family.

I bought a house with my DM and the same happened with us. I couldn't get a mortgage with her on it due to age and it meant the mortgage was short-term and unaffordable, my financial advisor tried everywhere. Originally we thought we had found a mortgage provider who would accept the deposit from DM's sale with her having a claim on that proportion of the property and I mortgage solely in my name for the rest. We got to the 11th hour of the purchase and the mortgage company claimed to have misunderstood and would only accept the deposit as a gift with her holding no interest in the property.

It was so stressful. If you really want to do this, my advice is talk to a few solicitors and financial advisors first to get a clear view on how to proceed in the best interests of all parties

You should also consider whether in the event you died or became disabled or ill whether your DP would care for her.

Are you first time buyers? That comes with some advantages which you’ll lose if you buy with someone who’s owned property before.