Andrew Carrigan, Trusts and Estates Solicitor with Ashfords, looks at the thorny question of paying for care.
CAN they take my home? Most people raise this question when told they have to pay for their own long-term care.
If you own your home, when will its value be used to meet the cost of care?
In the diagram, right, the boxes above the line show when your house will/won’t be considered available to meet care fees.
Generally, if you are the sole owner and you’re not responsible for ‘keeping a roof over the head’ of someone else your house will be considered available.
The boxes below the line – labelled Planning – show the types of arrangements you might make to avoid your home being considered available to meet care costs.
You can try to disguise or dispose of the ownership of your home, but if you do it to escape the costs of your care it is ‘deliberate deprivation’.
Your local authority can challenge this type of action and either get it undone or assess you on the basis that you had not given away the asset or money realised from it.
Having said that, if you don’t own the whole of your house the local authority should only value your interest in it at the price someone would be willing to pay for that share.
For example, imagine you bought a house with your sister, each paying half the purchase price. You each own half of it, but then you need long-term care.
The local authority should only treat you as having an asset worth what a third party would be willing to pay for your 50% share.
It is unlikely that anyone would be willing to pay much for a half share in a house they can’t sell or live in.
Deferred Payment Agreements: another postcode lottery
IF your home is considered available to meet care fees the local authority may offer you a Deferred Payment Agreement.
This is an interest-free loan secured against your home.
Somerset County Council charges an upfront administration charge to provide a Deferred Payment Agreement.
Many local authorities impose such a charge, but it varies from county to county.
Somerset is pretty expensive at £350, compared with Bournemouth (£500), Gloucestershire (£300), Poole (£250), Leeds (£145) and Brighton & Hove (£100).
The key is not to be rushed into signing agreements or documents, and if you feel you are being put under pressure you should call us to discuss the position.
Next month I will move on to the methods used by the local authority to assess care needs. To read a longer version of this feature see www.ashfords.co.uk/can-they-take-my-home/