Tenants In Common Question

[johnk]

How do you make a tenants in common agreement to protect your house for the benefit of your children if you need to go into care?

[New Judge]

I think you need to make the change on the Land Registry records.

However, making a joint ownership into tenants-in-common will not protect your (half) of the house should you need to go into care. What it does is to make each half of the value of the property discretely owned by each of the parties. As joint tenants, upon the death of one of the owners the entire property reverts to the survivor. The deceased’s “half” cannot be willed to anybody else or distributed under the rules of intestacy because he doesn’t actually own a half. He is simply one party to the partnership that owns the whole. As a tenant-in-common it can. If anything it is more likely to jeopardise the equity that the person going into care has in the house.

Before you worry about how to do it, you need to take proper advice to discuss your reasons for wanting to do so as you don’t seem too clear about the difference between the two types of joint ownership.

[woofgang]

Additionally to New Judge’s most erudite answer, I don’t think there is anything that you can do that will work to protect your assets if you have to go into care. Factually what happens in the assessment process is that whatever you have is subjected to an assessment process and from that assessment the amount that you are expected to contribute to your care is arrived at. If you are adjudged to have deliberately deprived yourself of assets by whatever means, then you are assessed as if you still had the asset and the council’s contribution is adjusted accordingly. They don’t care whether you can get the asset back or not.

[1581960]

My wife and I looked into this about ten years ago, took legal advice and made wills at that time. Has there been any changes in the last ten years that we should be aware of? There being very little change in our circumstances how often should we reassess our wills?

[woofgang]

The rules on deliberate deprivation were in place and the same as now more than 10 years ago when I retired from practice in the NHS. I think what has differed is the councils’ willingness to invoke the rules due to there being less public finding and more people needing residential care. The care component of funding is paid by the NHS and is not means tested.

[1581960]

Thanks woofgang.

[New Judge]

The principle advantage of "tenants-in-common" is that each partner has their own "half" of the property to do with as they wish. This is particularly useful (in fact imperative)if they want to leave their share of the property to anybody other than the partner with whom they share ownership. But it does not protect assets from being taken into consideration when things like care costs are being considered.

[1581960]

Thanks New Judge, the answers so far seem to relate to when care is necessary for one partner whilst the other is still alive, how is the value of the house assessed for the widow or widower when they require care? By this time could half the value of the house be in trust for others?

[EDDIE51]

This has come up before. I will put again what I know.
My brother is a senior finance manager for a large London council, he has to handle matters like this on a daily basis. He tells me that they can and do go back up to 15 years to see if there has been 'deprivation of assets' . He does not like having to do it but with the increase in the cost of care combined with the cuts in funding there is no other option.

[woofgang]

EDDIE is right. Its not what you do, its the intention behind it What the Council is looking for is “intentional deprivation of assets” If they feel that there is evidence that whatever someone did was deliberately intended to avoid paying care costs then they can assess as though the asset is still owned.
Age Concern here http://www.ageuk.org.uk/home-and-care/care-homes/deprivation-of-assets-in-the-means-test-for-care-home-provision/

but read this one too!
Dammit, I can’t find the other link, I have posted it on here before. Its advice for practitioners who are asked about protecting assets from council assessment. The first thing it says is that the act asking for advice can be used as evidence that the client intends to deliberately divest and that therefore if a client asks for advice, the practitioner should explain the situation and decline to advise. If they do offer advice, apart from “don’t do it” then the practitioner lays themselves open to a complaint by the client!

[1581960]

Thanks again woofgang, pity the other link has gone missing, thanks Eddie.

[Barmaid]

The key here is to read Charging for Residential Accommodation Guidance (CRAG). A share of jointly owned property is normally permanently disregarded if the spouse or partner or civil partner is still living there as their only or main home. See section 7 of CRAG.

[johnk]

So it sounds like if we want to pass anything on to our kids we have to die not in care?

[Peter Pedant]

Hi Barmaid
thanks for that !
I will of course read with ... interest and concentration

I wanted to add " a jointure can be severed by any document except a will " but that is not really in the tenor of this thread ....

and yes Johnk I have no intention of dying in care
( slightly different diagnosis for me - dementia is very very unlikely)

[Barmaid]

There are a few ways of severing a JT, PP. The most popular one is by notice which is served on the other owner. You are right though, it cannot be done by Will, but it CAN be done by Deed of Variation (which is a bit strange).

[Peter Pedant]

oh blimey thank you sweet one
missed that for my equity exam ....

[woofgang]

That’s very interesting Barmaid. It used to be that if the persons residence was also the residence of the spouse or partner or civil partner and the person is still living there as their only or main home, AND the person being assessed had an interest in the property, either jointly or in common, then charges could be recovered when the house was eventually sold.