Halton Borough Council is warning of firms asking people to pay up to £3,000 to draw up a will and create a trust to stop your home and savings being used to pay for your social care, but they may not be legally valid and may carry risks that you’re not aware of.
Every day we hear about the pressures on social care, we can become concerned about how we will pay for care if we need it and we worry that we will have nothing left to leave to our family.
Some companies see this as an opportunity and will offer you advice on how to protect your home and savings from being used to pay for your care.
Halton Borough Council’s Executive Board Member for Trading Standards, Cllr Dave Cargill, said: “The companies often advise that you dispose of your home to family members by creating a trust so that your home is not legally yours and therefore can’t be included in an assessment of your ability to pay for care charges.
“Such companies can charge up to £3000 to draw up a will and create a trust for you but the trust will not work if the council can show that you have deliberately disposed of your assets to avoid paying care charges.”
Sometimes such companies will cold call you and offer to visit you in your home or will invite you to a seminar in a local venue.
If you are concerned that you or a family member may need care in the future, consider the following BEFORE you give any money to anybody to create a trust for you:
• Nobody is forced to sell their home in their lifetime to pay for their care.
• The amount you pay towards your care depends on your level of income and savings. If you have savings over £23,250 then you will be expected to pay the full cost for your care. In some circumstances the value of your home will be taken into account.
Facts you should know if you own your home and need social care.
Fact 1: The value of your home is ignored completely if you receive care in your own home
Fact 2: The value of your home is ignored completely if you go into residential care on a temporary basis and are expected to return to your own home within 52 weeks
Fact 3: The value of your home is ignored completely if you go into permanent residential care but your partner remains living in your home
Fact 4: The value of your home is ignored completely if you go into permanent residential care but your child or a close relative aged 60 or disabled remains living in your home.
If the value of your property does need to be taken into account then you still have a number of options that would mean you would not need to sell your home to pay for your care including the possibility of deferred payment which can allow you to delay paying for part or all of your care fees until you choose to sell your home, or until after your death.
Don’t be tempted to make a snap decision, especially if the person advising you will be earning money from you, creating a trust is an important legal decision:
• If you sign your home over to someone else this could have serious consequences because you will have no legal right to it!!
• Transferring all or part ownership of your home can change your rights as an owner
• If the Council believes that you have given away savings or assets such as your property in order to pay lower care fees, you may still be treated as owning those savings or assets in full and still be charged the full cost of your care. The law further allows the Council to take recovery action against the person that you have given your assets to and could result in a County Court Judgement being taken against them.
Halton borough Council has produced information leaflets on Deferred Payment Agreements, Fairer Charging and Residential Charging which are available by emailing firstname.lastname@example.org or for more information on how care charges are assessed contact the Income & Assessment Team on 0151 511 7888 or email email@example.com
Deferred Payment Agreement : This is an arrangement with the council that enables the value of your home to help pay care home costs. If you are eligible, you will be able to delay paying for part or all of your care fees until you choose to sell your home, or until after your death. The amount you can defer will depend on the value of your home, which determines your ‘equity limit’.
It is very important that you consider all options open to you and that you take qualified independent financial advice. Organisations such as Society of Later Life Advisers (SOLLA) , The Money Advice Service and My Care, My Home can all help you find the most appropriate advice service.