Property News · August 28, 2014

Tenancy in common – solution to avoid selling my house for care home fees?


I have been approached by a firm promoting this solution – it isn’t widely publicised and sounds too good to be trueQ I have been approached by a firm promoting tenancy in common as a foolproof method of avoiding having to sell my property to pay for care home fees. They claim that changing the ownership of the property and making children beneficiaries in a will means the property will be protected should the parents have to go into care. Given the concerns on this subject expressed by many elderly people, the apparently simple solution of changing ownership to tenants in common isn’t something that is widely publicised. I would appreciate it if you could confirm that the proposed solution is, in fact, straightforward and valid and tell me if you are aware of any pitfalls. CLA The solution that a firm has proposed to you is a recognised way of avoiding paying care home fees and is relatively straightforward to set up provided you use a suitably-qualified solicitor such as a member of the Society of Trust & Estate Practitioners. What you do is change your joint ownership of your home to tenants in common (if you don’t already have this form of ownership) which means that you can leave your share of the home to anyone in your will. You then get a will drawn up in which you create a “flexible life interest” for your spouse which means that if you die before him or her, your share of the property will be held in trust giving your husband or wife the right to live in the property for the rest of their life. It is common to make children the trustees of this trust. The reason for all this legal work is that were your spouse to need to go into care after your death, only the value of their share of the property would be taken into account in the local authority means test used to assess the amount of care home fees that she would be liable for paying. And the value of your wife’s share could be reduced to nil as it would be unlikely that anyone would want to buy it which would mean that the entire value of the property could be excluded from the means test. Continue reading…

Source : theguardian.com
Read more…Tenancy in common – solution to avoid selling my house for care home fees?

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