People in Swindon with elderly relations in care are being warned to protect their family home from potentially being sold to cover nursing home and residential care costs in the aftermath of the Comprehensive Spending Review.
The long-awaited Coalition Government review has been revealed and one of the proposals outlines radical ways for local authorities to claw back expenditure in a bid to stabilise the economy and reduce the national deficit.
Residential and nursing home care costs councils a large chunk of their social services and welfare budgets as they have a duty to provide it to residents over 60 years of age. However, they also have a statutory right to recover the full cost of those charges if the individual is able to pay for them
Lemon & Co, a law firm based in Regents Circus in Swindon, has said cuts to public spending could see local authorities forcing sales of homes in a bid to reimburse total care costs – leaving co-habitants, co-owners and potential benefactors of the property homeless or without their anticipated inheritance. This becomes particularly relevant where there is a child or spouse who lives in the property and has cared for the family member or if there is a child living in the home who is over 60.
Deirdre Moss, Managing Partner at Lemon & Co, said: “This is a time of great concern for people who have family members going into or already in care as councils across the country will be forced to make difficult decisions – and part of that will inevitably be looking at how to cover costs of residential care.
“We have experienced a number of instances where the property is owned jointly between the parent and child, regardless of whether the child lives in the property or not but when the parent goes into residential care, the question of whether the property is sold arises. Certainly, the court will look very carefully at the reason for the property having been bought together or transferred into the names of the parent and child. The important issue is not to allow the local authority to exceed its powers.
“It is also entirely possible that the person living at the property may have gained a legal interest in the property, even though his or her name is not on the deeds by expending his or her own money and his or her own time and effort on the property itself and therefore gaining a financial interest in the property. In that instance, one would expect the co-habitant to defend the local authority’s insistence that the property is sold.”
Mrs Moss added: “The value of the property in these instances or indeed in instances where the child does not live in the property may be nominal or even nil. The reason behind this is that it’s rare for a buyer to purchase a property at market value with either the other owner resident in the property or knowing that it has another owner, simply because it is a very unattractive investment and hence is unlikely to attract any interest at all.
“The end result is that the local authority may not be able to insist the property is sold and may not be able to demonstrate that there is any value to be had. It is therefore vital for those who find themselves in this position to seek professional advice to help avoid significant losses”.