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Selling of family home for care costs

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Gina73
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Selling of family home for care costs

#1 Unread post by Gina73 » Mon Jun 18, 2012 8:08 am

I dont know if it something you can answer for me.

My husbands mother has gone into a care home and we dont think that she will ever be able to return to her own home which she owns outright. Social services are involved and have told my husband and his sister that they are going to have to sell the house to pay for the care home. My husband and I have been advised that we could rent the house and what rent we pay would go towards the cost of the care home. I am not sure where we stand with this and can social services 'make' you sell the home as we have been told that they are not able to. Any advise you could give would be of help.
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Re: Selling of family home for care costs

#2 Unread post by Lawyer Mark » Mon Jun 18, 2012 10:20 am

Hi Gina, firstly I am sorry to hear that your mother-in-law has had to go into care.

Unfortunately, what they say is largely right. Assuming there is no spouse or other "dependent" who lives at the property (usually someone not able bodied or over 65). However, the council are only looking to ensure that the bills for the care provided are paid, so if these are able to be funded by other means and paid they will not be worried about the property or look to attack it. Therefore it may make better financial sense to let out the property and use the rental income to pay the bills whilst still maintaining the asset. I have a very helpful guide to care homes that I can send to you if you have an email address (I can't work out how to attach a PDF on here - Louise can you help?) which may answer your questions or other thoughts, but if there is anything else let me know. Also, as an aside, does your husband have a Power of Attorney to deal with his mothers matters as this will probably prove useful in allowing him to assist with his mother and ensure her bills etc are paid. Let me know if you need any help with this.

regards
Mark

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Re: Selling of family home for care costs

#3 Unread post by weezypops » Mon Jun 18, 2012 10:41 am

No problem, if you click here Gina, I've uploaded the PDF.
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Re: Selling of family home for care costs

#4 Unread post by Gina73 » Mon Jun 18, 2012 3:19 pm

Thank you for the quick response. My sister-in-law is currently applying for power of attorney, we did think about us renting the house of her but the care home is over £600 a week and the property would only be worth about £750 a month to rent, what would become of the shortfall. My husband and I did speak about us buying the house but due to us renting we cant afford to save for a deposit and nowhere gives 100% mortgages now.
Mum to Mia & Mason, wife to Steve - life is for living.

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Lawyer Mark
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Re: Selling of family home for care costs

#5 Unread post by Lawyer Mark » Mon Jun 18, 2012 5:29 pm

Unfortunately care is very costly. It sounds as though you are going to have to do a bit of a costs / benefits analysis. The default position is that the property should be sold and used to cover the fees. I'm not sure how much the property is worth but at £600 per week, which equals just over £30,000 per years the value of the asset will obviously be reduced quite substantially. If the property achieves a rental income of about £750 per month then the property is going to earn £9,000 a year. If the shortfall can be found to cover this then in the long term this is beneficial financially as the property is earning that amount, whilst still holding its value when it is eventually sold of bequethed in a will. If it is sold now then no income will be derived against it. However if there is no one who is able to make up the shortfall the simpliest way will be to sell the property to finance the care fees.

Let me know if there is anything more specific I can help with and I am happy to discuss this on the phone. Care fees are very expensive and I would urge all posters on this forum to consider their finances, estate planning and their wills. I know it all seems a long way off but it can prevent a lot of problems, costs and acrimony in the future.

regards
Mark


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Re: Selling of family home for care costs

#6 Unread post by XxJack~AcexX » Thu Jul 05, 2012 10:35 am

Ahh huni its so unfair isnt it. Stressful as it is with Steves mum being in a home. x
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