Property trust will advice needed

[Tattybogle2]

In my late fathers will half of the house was left to me in a trust, with my mother retaining her half and entitled to live there as long as she lived.

My mother currently lives in the house but has dementia so we are looking into options for her long term care ;
A )
Pooling our resources and buying a house we could all live in together ( neither my mothers or my partners & my house are big enough to accommodate us all, so we would need to buy a larger, more expensive property)

If we did this, what would happen if my mother later needed to go into a care home and her share of the property was required for the fees ?
We have enough money put aside to cover 2 or 3 years worth of care home fees.
How would you legally reflect each person's financial contribution to the property during initial purchase and any payments for improvements ?
Would myself & partner have to sell up ?
What would happen to the share of the property held in trust ?

B )
If my mother were to go into care at this point and we sold the house ;
I guess I can bank her share of the proceeds for later care home fees, but what would happen to my share in trust ? Would it come to me ?
Could I use my mothers share of the proceeds and / or the will trust share to invest in a property that myself & my partner would live in, with everyones share / interest somehow legally registered ?
What would happen if, as above, she later needed her share of the property to pay care home fees ?

May be relevant ;
My mother is in her 80's.
My partner & myself are in our early 60's, not married and jointly own our own house.
I have power of attorney.

"May be relevant ;
My mother is in her 80's.
My partner & myself are in our early 60's"

This is very relevant indeed when it comes to care home fees.

"If we did this, what would happen if my mother later needed to go into a care home and her share of the property was required for the fees ?"

There is a mandatory disregard where a "family member" over the age of 60 or who is disabled is living in the home when the person goes into care and it is the main or only home of that family member.

Typically, this would be a spouse, but it also covers children, siblings (or the spouse or unmarried partner of any of the preceding) and also aunts/uncles nephews/nieces etc.

But there are two important things, you must have been living in the same house prior to your mum going into care and it must be your main or only home.

So, what this means is that the value of the home is not counted at all and will not be taken for care home fees.
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"A )
Pooling our resources and buying a house we could all live in together ( neither my mothers or my partners & my house are big enough to accommodate us all, so we would need to buy a larger, more expensive property)"

Sounds like a reasonable idea.

"How would you legally reflect each person's financial contribution to the property during initial purchase and any payments for improvements ?"

That one is simple. You can write up a legal agreement stating that your mum owns X%, the trust owns Y% and you and DP own Z%. This agreement can also allow for what happens when one party puts more into the property.

If you speak to a solicitor who is experienced in this area then they will be able to do this for you.

"Would myself & partner have to sell up ?"

Do you mean if your mum goes in to care. If you were already living there and it was your main home and you're over 60 then - no.

"What would happen to the share of the property held in trust ?"

It all depends what the will says. If the will says that she has a life interest then it stays as part of the trust until she passes away.

If it says something else, like maybe until she goes into care then the trust will come to an end when she goes into care and the value of the trust passes to the beneficiary (this then becomes a potentially exempt transfer - only important if it's possible that your parents estate may face paying inheritance tax).
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B )
If my mother were to go into care at this point and we sold the house ;
I guess I can bank her share of the proceeds for later care home fees, but what would happen to my share in trust ? Would it come to me ?

If you chose to sell the home at that point (perhaps the care home you want her to go into is beyond what the council will pay for) then yes you would put her share of the home into a bank account.

As to the trust money, it depends what the will says. If the trust ends when she goes in to care then, yes, you get the trust money straight away. If it is a life interest then the money stays with the trust.

Your mum is entitled to any income from the trust (eg interest or dividends) but cannot touch the capital. So it would be up to the trustees of the trust to invest the capital in a mix of investments. Some of these investments would be focused on income to benefit your mum and some would be focused on capital gain to benefit you. You could not touch the capital in the trust until your mum passes away.

Could I use my mothers share of the proceeds and / or the will trust share to invest in a property that myself & my partner would live in, with everyones share / interest somehow legally registered ?

Do you mean after she has gone into care or now? If you are talking now then, yes, you can definitely do that. If you are talking after she has gone into care then probably not.

"What would happen if, as above, she later needed her share of the property to pay care home fees ?"

Given that you are over 60 and would be living with her before she went in to care then the local council would disregard her share of the home and there would be no need to make any payments.

If you chose to use her share of the home to pay privately for a care home then that would be down to you how you pay that. You could sell the house at that point or get a mortgage to cover the amount instead.

Many thanks for your reply, very helpful.

We are not currently living with my mother ( not enough room ) ideally we would like to buy a bigger property together but selling 2 houses at the same time in order to fund a property that suits everyone and all with an 80+ year old with dementia will be a challenge. We had thought perhaps my Mother could have respite care whilst this process takes place to make it easier for her ? But as she says, what if she likes the care home and decides to stay permanently , where would that leave us legally having used the either the entire value of her home or maybe just my property trust share, depending on the cost of the bigger house ( along with my house sale proceeds) if she never actually lived in that property ?

I believe my mother has a life interest, though the wording in the will differs from what I have seen previously. " whilst my wife remains alive and desires to reside in the property and so long as she remains my widow......." My Mother no longer "desires" to live in the property , she would much rather either live with us or in a care home where she has company & care 24/7.
So, I am unsure if under either circumstance - living with us or going into care, whether the property trust part would have to stay in trust ( and then what you can & can't do with that) or could be released to the beneficiary at that point ?
I guess I will have to speak to the solicitor who drafted the will for clarification.

"I guess I will have to speak to the solicitor who drafted the will for clarification."

Yes, I would strongly recommend that.

" whilst my wife remains alive and desires to reside in the property and so long as she remains my widow......."

The bit about her remaining his widow is odd, this may be a reference to remarrying. So if your mum were to remarry then her interest in the home would come to an end.

With the bit about desiring to reside, there is typically a clause that allows the trust to use any money from the sale of the current home to help buy another home.

Is there a clause like that in the will? If not then it would appear that the trust will come to an end when your mum no longer wishes to live in the current house.

You really do need to speak to a solicitor about exactly what this means in your particular situation.
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"...where would that leave us legally having used the either the entire value of her home or maybe just my property trust share, depending on the cost of the bigger house ( along with my house sale proceeds) if she never actually lived in that property ?"

Your property trust share will be protected from any care home fees regardless - that was the point of putting it in trust. Also, any equity that you and DP put into the house are not counted at all.

As I understand it, your mum's share of the house is not counted for any short term or temporary care.

But, if she were then to remain there and it becomes long term care then, since you were not living together in the same house before she went into care, there would be no mandatory disregard.

This would mean that your mum's share of the house would be counted. The local council will then put a charge on the property for a certain percentage of your mum's share which will need to be paid when the house is later sold or your mum passes away (whichever happens first).

In contrast, if you were to buy the new home and your mum comes out of respite care and lives with you for at least a short period of time in your joint house then, if she later goes back into long term care the mandatory disregard will apply.

Overall, you really do need to speak to a solicitor about the whole situation.

Yes, I think the remaining a widow bit does sound like if she were to remarry then the current arrangement comes to an end ?
Likewise the desire to reside ( not right to reside & no mention of lifetime interest) sounds like if she no longer desires to reside there again, this arrangement ends ?
The will was made in 2009 and quotes the standard provisions of the society of trust and estate practitioners (first edition)
The more I read it, the less clear it becomes !! Will make an appointment to see my solicitor today.
Again, thanks for all your advice.

Hi, just to let you know that I have been to see my solicitor.
Seems that it is all much simpler than the will makes it sound.
If we were to pool our resources and jointly buy a property then my mother would retain her " desire to reside" until she doesn’t ! I could stay in the property and only be assessed by the local authority if my mother needed her share of the property for additional care home fees, though given my age this is likely to be considereda disregard, so very unlikely I would need to sell up and move again.
If we decide to sell the property and my mother went into care, then the trust arrangements cease and my mother gets her share of the value of the property paid into the bank and so would I.
So all much clearer now and I can make sensible decisions for my mothers long term care without worrying about the implications and potential upheaval.