who house is it

[plumbercarl]

my parents used to own a house which was owned by the local authority, 4 years ago i bought this property using there discount with my parents consent, they have lived there rent free to date, a conveyancer drew up the agreement which says im the owner and my parents the trustees. IT STATES that they can live there till they die then i will own the property, Now ever my parents now need to go in a care home my problem being will the house be seen as part of my parents savings? and need to be sold to pay for there care

[Barmaid]

More and more of these cases are coming about - you have two problems here.

Firstly, the fact that your parents did a Dec of Trust declaring you as the beneficial owner and them as trustees could constitute a disposal. Any disposal within 3 (I think, could be 5) years can result in the LA trying to clawback the discount.

Assuming they don't seize on that point (most of them are not awake to it - yet), whilst your parents have declared a trust, there is room for argument that they have disposed of their assets. If a substantial reason for this was to avoid care home fees, your parents can be deemed to have the capital. (You may be able to argue that the main reason was to enable you to introduce funds to purchase their house, which would probably work, but consult the CRAG document - soon to be updated).

However, I would argue that the extent of their capital is proportionate to the discount they put in - eg if the discount was �20k and the house cost �100k, they are entitled to 20%.

However, generally speaking (if the above points are not taken), your parents as trustees should be safe from the LA since they are not the true owners of the property.

[gouldc]

I almost bought my grandparents house in this manner.

I believe they would have to own the house for at least three years after the purchase before they can transfer ownership to someone else (due to the laws governing the purchase of these types of houses).

If something happened to them within that three years (ie had to go into care), then the house would have to be sold to pay for the care - after three years, the house could go to me, and they would not have to sell the car.

Someone will probably explain this better. In your case, I think it would be in your interest to get the house transferred into your name as if it is still technically your parents, then they may need to sell it if the worst happens

[gouldc]

Barmaid beat me to it, and put it far more eloquently : )

[plumbercarl]

thank you for the replies, when i purchased the house my parents were in good health, but as they were in there seventies they did not what to buy it due to there age, as they had lived there for 25 years thay would get the maximum discount , so i said may i buy it and you can live rent free to which thay agreed,, The local authority is 3 years befour it can be sold so this is not a problem i must also add that my parent have substantial savings and will have to pay for care however my concern is when there money runs out will it affect the house?