Legal advice on deferred agreement for care fees
Discussion
I share joint power of attorney with my brother on behalf of our mother who's just gone into long-term residential care due to Alzheimer's.
We're potentially at looking at a deferred agreement against her property, which is owned outight, but having not been in this situation before and not knowing anyone that has either, would like some legal advice. It's a big decision and one we can't get wrong.
I'm happy to pay for some time with a solicitor who's given advice concerning such agreements before and can run through the pros and cons, and answer the questions we have.
In terms of finding the right solicitor, what sort of specialism should I look for? I'm really only wanting to deal with somebody who's very familiar with the situation.
Thanks in advance.
We're potentially at looking at a deferred agreement against her property, which is owned outight, but having not been in this situation before and not knowing anyone that has either, would like some legal advice. It's a big decision and one we can't get wrong.
I'm happy to pay for some time with a solicitor who's given advice concerning such agreements before and can run through the pros and cons, and answer the questions we have.
In terms of finding the right solicitor, what sort of specialism should I look for? I'm really only wanting to deal with somebody who's very familiar with the situation.
Thanks in advance.
Drumroll said:
When my mum went into care we sold the house, put the money into savings and paid care home fees from that.
Is you father/mothers partner still living in the house is that the issue/
Maybe of no use to the OP but we did the opposite.Is you father/mothers partner still living in the house is that the issue/
When my FIL went into care he had a bit in a private pension plus his normal pension only left a bit of a shortfall for the care home fees.
So the house has been rented out to make up the difference and when he eventually dies there is sill something to pass onto his children.
The situation is the home is owned outright and she lived alone until very recently with care workers visiting at intervals during the day.
There are no savings and there's no private pension either.
The care package, benefits and personal independence payments received when living in her own home came to around £450 per week.
We're awaiting another financial assessment to be carried out but we're told the local authority will fund a residential placement up to £500 a week maximium. The letter I received recently on an initial assessment, taking into account her outgoings, property, pension and savings etc says her own personal contribution will be around £70 per week.
On top of this there are top up fees of £110 a week. So all in, £180 a week.
The finance team explained to me that if the property was sold the money in the bank would be taken into account during the financial assessment. And as such there'd be no local funding. Similarly, if the property was rented they'd take this into account and reduce the funding accordingly.
So it seems the best financial decision is to leave the property empty!? Else you're effectively turning away free funding.
So far as I understand it, we're only deferring the shortfall of the £500 plus the top up fee as a combined figure. Unless I'm getting things very confused and we're actually deferring £430 a week (balance left of the £500 a week) plus the top up fees?
Desperately trying to reach somebody from the financial team at the council but I'm not getting calls returned.
There are no savings and there's no private pension either.
The care package, benefits and personal independence payments received when living in her own home came to around £450 per week.
We're awaiting another financial assessment to be carried out but we're told the local authority will fund a residential placement up to £500 a week maximium. The letter I received recently on an initial assessment, taking into account her outgoings, property, pension and savings etc says her own personal contribution will be around £70 per week.
On top of this there are top up fees of £110 a week. So all in, £180 a week.
The finance team explained to me that if the property was sold the money in the bank would be taken into account during the financial assessment. And as such there'd be no local funding. Similarly, if the property was rented they'd take this into account and reduce the funding accordingly.
So it seems the best financial decision is to leave the property empty!? Else you're effectively turning away free funding.
So far as I understand it, we're only deferring the shortfall of the £500 plus the top up fee as a combined figure. Unless I'm getting things very confused and we're actually deferring £430 a week (balance left of the £500 a week) plus the top up fees?
Desperately trying to reach somebody from the financial team at the council but I'm not getting calls returned.
thenortherner said:
The finance team explained to me that if the property was sold the money in the bank would be taken into account during the financial assessment. And as such there'd be no local funding. Similarly, if the property was rented they'd take this into account and reduce the funding accordingly.
I'm going through similar at the moment and my (mother's) position seems to be that the house either has to be sold, or the fees deferred against it until it is sold. Then until you get down to the 24k ish level, there is no contribution to the fees to be paid. So there isn't an option to just decide not to sell the house if Ma was living there alone (as mine was).But like you, I am looking for where to find an expert on the matter. Is it an area of expertise for 'normal' solicitors? Ones with specific expertise, or someone else?
Not much help I'm afraid, but I'd like to find the answer too.
Bert
thenortherner said:
The situation is the home is owned outright and she lived alone until very recently with care workers visiting at intervals during the day.
There are no savings and there's no private pension either.
The care package, benefits and personal independence payments received when living in her own home came to around £450 per week.
We're awaiting another financial assessment to be carried out but we're told the local authority will fund a residential placement up to £500 a week maximium. The letter I received recently on an initial assessment, taking into account her outgoings, property, pension and savings etc says her own personal contribution will be around £70 per week.
On top of this there are top up fees of £110 a week. So all in, £180 a week.
The finance team explained to me that if the property was sold the money in the bank would be taken into account during the financial assessment. And as such there'd be no local funding. Similarly, if the property was rented they'd take this into account and reduce the funding accordingly.
So it seems the best financial decision is to leave the property empty!? Else you're effectively turning away free funding.
So far as I understand it, we're only deferring the shortfall of the £500 plus the top up fee as a combined figure. Unless I'm getting things very confused and we're actually deferring £430 a week (balance left of the £500 a week) plus the top up fees?
Desperately trying to reach somebody from the financial team at the council but I'm not getting calls returned.
Advice we were given similarly at the time was the house couldn't be sold from under you if there was someone else living there as their main residence who was aged 60 or over. A charge could be put on the property by the local authority for whenever it was eventually sold. Don't know if of any help etc but was given by solicitors. Worth getting advice anyway I guess, we spoke to my relatives regular solicitor and they had a specialist within their firm who did this week in week out.There are no savings and there's no private pension either.
The care package, benefits and personal independence payments received when living in her own home came to around £450 per week.
We're awaiting another financial assessment to be carried out but we're told the local authority will fund a residential placement up to £500 a week maximium. The letter I received recently on an initial assessment, taking into account her outgoings, property, pension and savings etc says her own personal contribution will be around £70 per week.
On top of this there are top up fees of £110 a week. So all in, £180 a week.
The finance team explained to me that if the property was sold the money in the bank would be taken into account during the financial assessment. And as such there'd be no local funding. Similarly, if the property was rented they'd take this into account and reduce the funding accordingly.
So it seems the best financial decision is to leave the property empty!? Else you're effectively turning away free funding.
So far as I understand it, we're only deferring the shortfall of the £500 plus the top up fee as a combined figure. Unless I'm getting things very confused and we're actually deferring £430 a week (balance left of the £500 a week) plus the top up fees?
Desperately trying to reach somebody from the financial team at the council but I'm not getting calls returned.
I don’t know if your mum has any pressing medical needs, but if she does it is worth investigating if the care can be funded by the NHS in its entirety, not by Social Services/Council. My father in law lived with us for several years until his combined Alzheimer’s and Vascular Dementia made it impossible for us to cope as we also had a young family. He sold his house when he moved in, which was after his wife died and gifted some of the proceeds amongst the family as a sort of living will, keeping £200k odd on one side. When the time came, dementia care in a private facility (which we had used for respite care, for holidays etc) soon was at £6k a month - don’t get me wrong it was more like a hotel than a care home, very good staff/resident ratio but we realised that was soon going to win a fight with his savings and the only alternative when the cash ran out was a really grotty council facility with staff that apparently couldn’t give a toss. We were told that if certain care needs could only be carried out by a qualified medical person, then there was a mechanism where the NHS would pay as an alternative to a hospital bed. There had to be a specialist assessment done but he qualified and all care bills were dealt with by the NHS, leaving only minor fees for haircuts, podiatrist etc. Interesting to note that it was considered against his best interests to move him to a less expensive place as he would respond to certain staff members only, but be extremely difficult to others - his disease had reached fairly epic proportions personality wise.
Worth looking into if you think she may also qualify, then the house is totally out of the equation as there no charges or payback
Worth looking into if you think she may also qualify, then the house is totally out of the equation as there no charges or payback
Edited by vitesse2000 on Monday 24th February 07:38
Edited by vitesse2000 on Monday 24th February 08:28
Hi
I don't know the full ins and outs but my wife's family are going through this now, have been for nearly 12 months now.
Her grandmother has been in a home for 12 months, its nearly £1k a week, she also has Alzheimer's, the granddad is still fit and well, they have a shared house (paid for) and did have circa £40k each in isa's, he had a good job in the past (coal mining) and has a very good pension, most of her savings have now gone, the solicitors have told him to stop paying now that has run out and they are seeing what support he can get, they have spent circa £2k on solicitors fees up to now to, its seems a minefield, he has no problem paying from his savings but doesn't want to lose his house to pay for the care, this is now what the solicitors are sorting.
He is 82 and the is 81, he has 4 sons (one my wifes dad) who really don't seem to understand the complex nature so my wife pretty much handles it, they have now got POA form him but only 1 had POA for the Nan, solicitors threw another curve ball the other day saying if he should pass first all the house funds would go to the provision of care for her.
Terrible situation all round with this illness but I would suggest getting legal support as soon as you can.
I don't know the full ins and outs but my wife's family are going through this now, have been for nearly 12 months now.
Her grandmother has been in a home for 12 months, its nearly £1k a week, she also has Alzheimer's, the granddad is still fit and well, they have a shared house (paid for) and did have circa £40k each in isa's, he had a good job in the past (coal mining) and has a very good pension, most of her savings have now gone, the solicitors have told him to stop paying now that has run out and they are seeing what support he can get, they have spent circa £2k on solicitors fees up to now to, its seems a minefield, he has no problem paying from his savings but doesn't want to lose his house to pay for the care, this is now what the solicitors are sorting.
He is 82 and the is 81, he has 4 sons (one my wifes dad) who really don't seem to understand the complex nature so my wife pretty much handles it, they have now got POA form him but only 1 had POA for the Nan, solicitors threw another curve ball the other day saying if he should pass first all the house funds would go to the provision of care for her.
Terrible situation all round with this illness but I would suggest getting legal support as soon as you can.
When it was clear that my relative was unable to live in her own home, we used some of her savings for home improvements to get her house in to a condition where it was suitable to rent out.
The care home was then paid for by using a combination of her state pension, the rental income and a local authority deferred payment scheme.
With the deferred payment, the rise in house prices over a three year period cancelled out the money owed to the council. The council 'loan' was interest free until one month after death and then i believe 8% was charged. This meant that the house had to be sold ASAP to avoid interest.
This system worked well with us but beware of using 'specialist' advisors. They're obviously in it for their commission and you'll be surprised at the amount of people who approach you offering advice. They are usually tipped off by the care home once the admission process is started.
Had we chosen to go with the advice given by the 'specialist' (some sort of insurance policy based on a guess at how long the person is likely to live), most of her assets would have been handed over to them!
As for NHS funded nursing care - good luck with that - you've got to be literally on your death bed.
The care home was then paid for by using a combination of her state pension, the rental income and a local authority deferred payment scheme.
With the deferred payment, the rise in house prices over a three year period cancelled out the money owed to the council. The council 'loan' was interest free until one month after death and then i believe 8% was charged. This meant that the house had to be sold ASAP to avoid interest.
This system worked well with us but beware of using 'specialist' advisors. They're obviously in it for their commission and you'll be surprised at the amount of people who approach you offering advice. They are usually tipped off by the care home once the admission process is started.
Had we chosen to go with the advice given by the 'specialist' (some sort of insurance policy based on a guess at how long the person is likely to live), most of her assets would have been handed over to them!
As for NHS funded nursing care - good luck with that - you've got to be literally on your death bed.
Contact a solicitor who deals with private client matters. Do no go for some cheapo High Street firm. I suggest that your initial call could be to Andrew Parsons at Radcliffes, and he can connect you with one of his colleagues. Or David Archer at BDB Pitmans. I shall ask a trad Chancery barrister of my acquaintance to recommend a smaller firm also.
Clearly you need expert advice. I think you should be prepared to be told that leaving the property empty will not ensure continued local authority funding as, after a grace period of some 12 weeks, its value (less an allowance for sale costs) will normally be taken into account.
https://www.ageuk.org.uk/information-advice/care/p...
https://www.ageuk.org.uk/information-advice/care/p...
All, thanks for the responses. Apologies for the delay in responding, I've other issues going on - see Home & DIY thread.
I'm sorry to read of other's stories who have or are experiencing something similar.
The solicitor recommendations are likely to be a little out of our league I'd imagine but no doubting their credentials from what I've read! Thanks all the same. I've found a local-ish solicitor who will help with the application for deferred payment and legal side of things for a fixed fee of £750. I shall let you know how I get on after the meeting takes place in a couple of weeks. If they're any good I'll pass on a recommendation to anyone who's interested via private message. Please, let me know.
I had a good 30 minute chat with the solicitor by phone and things are a bit clearer now.
I think I had things a little arse about face when trying to understand the deferred payment. Whilst in her own home the funding came to around £500 a week for care. I daftly assumed that this would still continue when in residential care, less what she was assessed to be able to contribute. I.e. assessed to be able to afford to contribute £80 from varying benefits etc therefore this amount would be deferred. It's actually the opposite way around - £420 would be deferred.
The options are:
Sell the home and pay for fees monthly
Rent the home and enter a deferred agreement. Rental income will reduce the amount deferred amount, not by much though
Leave the home empty
Option 1 would be viable if the home was worth a significant amount and some money could be invested. The home's worth maybe £150K so no chance of that, the whole lot will be eaten up pretty quickly.
Fees are £515 a week plus a top up of £107.
A review meeting held with the home this week had them mention that when the funding does run out the aim is to keep here there despite the top up fees.
Re. the specialist needs, there are none at present. But we'll be pushing for immediate reasessment if and when they come up for the reasons mentioned.
I'm sorry to read of other's stories who have or are experiencing something similar.
The solicitor recommendations are likely to be a little out of our league I'd imagine but no doubting their credentials from what I've read! Thanks all the same. I've found a local-ish solicitor who will help with the application for deferred payment and legal side of things for a fixed fee of £750. I shall let you know how I get on after the meeting takes place in a couple of weeks. If they're any good I'll pass on a recommendation to anyone who's interested via private message. Please, let me know.
I had a good 30 minute chat with the solicitor by phone and things are a bit clearer now.
I think I had things a little arse about face when trying to understand the deferred payment. Whilst in her own home the funding came to around £500 a week for care. I daftly assumed that this would still continue when in residential care, less what she was assessed to be able to contribute. I.e. assessed to be able to afford to contribute £80 from varying benefits etc therefore this amount would be deferred. It's actually the opposite way around - £420 would be deferred.
The options are:
Sell the home and pay for fees monthly
Rent the home and enter a deferred agreement. Rental income will reduce the amount deferred amount, not by much though
Leave the home empty
Option 1 would be viable if the home was worth a significant amount and some money could be invested. The home's worth maybe £150K so no chance of that, the whole lot will be eaten up pretty quickly.
Fees are £515 a week plus a top up of £107.
A review meeting held with the home this week had them mention that when the funding does run out the aim is to keep here there despite the top up fees.
Re. the specialist needs, there are none at present. But we'll be pushing for immediate reasessment if and when they come up for the reasons mentioned.
Drumroll said:
The other problem is different areas have different criteria. So yes you do need to speak to somebody CAB may be of help, we had mixed dealings with Age Concern.
The other problem is that different areas have different levels of incompetence. Edited by anonymous-user on Tuesday 25th February 17:49
My MIL spent 2.5 years in a care home before passing away last September.
We spent almost all of that time in a constant round of assessments, trying to get assessments, trying to get the NHS to work with SS and vice versa. It would probably have been less expensive for the state to simply cover the cost from the outset than to incur the cost of the so called support services box ticking, arse covering and prevarication processes.
In the end we still ended up paying 85% of the £1100 per week.
Good luck OP, it won’t be easy.
Presumably with £150k asset, your mother is essentially going to be paying the care home fees until her finances get to the 24k threshold?
If so, the question is whether she is paying the care home the commercial rate or the social services rate? In my case that's the difference between £570 and £890 per week.
Bert
If so, the question is whether she is paying the care home the commercial rate or the social services rate? In my case that's the difference between £570 and £890 per week.
Bert
mgv8 said:
For my grandmother we took out a £95,000 policy that was for the rest of her life. So if she lived a long time they picked up the bill but if she passed sooner then they get to keep the cash. It was a very good way to limit the liability.
I like the idea of that. Trouble is my mum's only 62 so can't imagine I'd get such a good deal.BertBert said:
Presumably with £150k asset, your mother is essentially going to be paying the care home fees until her finances get to the 24k threshold?
If so, the question is whether she is paying the care home the commercial rate or the social services rate? In my case that's the difference between £570 and £890 per week.
Bert
In all honesty, I don't know. We were presented with a list of homes from the local authority and the home she's in was on the list. I'll find out.If so, the question is whether she is paying the care home the commercial rate or the social services rate? In my case that's the difference between £570 and £890 per week.
Bert
We were advised the council would pay up to £515 for this home, as with any, and that'd it'd be means tested.
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