Fair Deal/Nursing Homes Is it advisable to sell home when owners enter long-term NH care?

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scatriona

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Apologies if this has already been discussed.

I'm attempting to do Fair deal applications for 2 elderly aunts who can no longer live independently. The aim is to find a NH where both can reside together. They are joint owners (unmarried) of the family home.

If & when we place them in a suitable NH, the family home will be empty & hard to upkeep as no other family will live there. Would it be wise to sell the home when they're settled & then would all proceeds be used to fund ongoing care? I've read about a 3yr cap, which I don't fully understand- after 3 yrs do any remaining proceeds just sit in an a/c and go into the estate when they pass away?
They have some savings but that would possibly only fund 1 year privately in a NH so some other arrangement ie FD loan or scheme would be required.

How have other people managed this when the owners go into NH care & house left unoccupied?
Thanks in advance!
 
I should add we don't really have the appetite to rent out the property as the nieces & nephews are scattered about & not willing to take that on
 
AFAIK the last thing that you should do at the moment is to sell the family home as their financial circumstances would have changed and they would then most likely not qualify for the Fair Deal scheme at all. Payments would then come out of their finances rather than being helped financially by the State.

The HSE rules are here and might help with advice.

The Citizens Information is here.

The 3 year cap is as follows:

3-year cap​

Some assets are only included in the financial assessment for the first 3 years you are in care. This is known as the ‘3-year cap'. It means that you pay a 7.5% contribution based on the value of certain assets for up to 3 years.

These assets can include:

  • Your home
  • The proceeds of the sale of your home
  • Your farm or business
After 3 years, you will not give any further payment based on these assets, even if you are still getting long-term nursing home care. The ‘3-year cap’ applies whether you choose to get the Nursing Home Loan or not.

All other assets will be taken into account for as long as you are in care.

If you have already been in a nursing home for 3 years when you apply for the scheme, then you do not pay the 7.5% on your home.


Make sure to check out the additional costs in any of the nursing homes that you are considering. They usually charge for hairdressing, podiatrist etc. but this post mentions one home that appears to be charging an additional €2,000 per month which is extraordinary.
 
If they sell say each aunt ends up with €250K in the bank from house purchases and savings and you use the fair deal they will pay 80% of any income (pension) plus 7.5% of their assets (~19K) per year to cover the nursing home costs.

If they don’t sell they still pay the same amount but by year 4 they pay nothing from the house value.

If they are in a position to make the decision I would think they should consider selling. What are they going to need the house for? It will become a burden to the nieces and nephews to mind, cut grass, organise insurance, keep out the damp etc. And to what end, they are not going to need the house when they pass away, and there is no family member hoping move in.

Should they not use their asset to pay for all the extras in nursing home care, rather than have it decline in value as it lies empty and then have a whole bunch of nieces and nephews inherit a relatively small amount of money?

I know if my MIL had been able to make a decision we would have encouraged her to sell, the house lay empty for 4-5 years before she died and while each child did inherit from the estate they were all in their 50’s and well established in their careers/lives and were not in need of an inheritance.
 
If they don't actually need nursing home care but would rather live in a warmer, safer environment without the hassle of maintaining a home, they will not qualify for Fair Deal, at least until each becomes needing of nursing home care. So, in the meantime, they will have to pay for nursing home care until one or both qualifies. Perhaps, some kind of home help might be possible, HSE provided or private, or a mix.

If they do qualify, if the house is sold, the HSE will assess 7.5% of the cash indefinitely which will whittle down their estate in a few years.
 
scatriona said:
I should add we don't really have the appetite to rent out the property as the nieces & nephews are scattered about & not willing to take that on
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Would it be possible to find an extended family member or friend who would look after it on a caretaker basis? For example someone who commits to paying all the bills, and carrying out minor repairs in return for rent free occupancy. The housing market is very tight at the moment and you will not struggle to find someone.

Am not a FD expert, but it would tend to make sense to me not to sell the house in order to preserve wealth.



Clamball said:
rather than have it decline in value as it lies empty and then have a whole bunch of nieces and nephews inherit a relatively small amount of money?
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I am a little sympathetic to the point of view above. It depends hugely of course on the value of the house, how close any of you live to the property, and the number of nieces and nephews. There is a threshold at which point it is not worth actively preserving wealth but that is going to depends on the circumstances.
 
Thanks both.
Unfortunately neither is in a position to make that decision; one was the guardian of the other (special needs)..and she now needs care (dementia) so follows that other will too. But the potential deterioration of the house is big concern, after finding suitable place for them of course.
 
It is a moot point now about the house unless someone has enduring power of attorney (or whatever it is called now). The aunt with Dementia cannot give instruction to sell the house and the other aunt may be a ward of court (or whatever that is called now). If the court has some jurisdiction they may give permission to sell the house.

So the best option is to get them into a nursing home under fair deal and then organise for the house to be sold if permission is given. There will still be a 3 year cap on the proceedings of the sale.
 
Yes we are enacting enduring Power of attorney at the moment. But I didn't realise the 3 yr cap applied to proceeds of house sale so that may be the route we'll take once we get them in somewhere. Thanks all!
 
Update & new qu! We sent in a preliminary application with the. Info we could find (eg pension(s), savings, house valuation etc) and sent a copy to the hospital social worker too. He has now come back & said he fears it will be rejected as she has too much.... I'm now more confused than ever as while she may have a healthy savings figure now, the monthly costs of a NH would make a huge dent over 12-18 mths of care and she is quite well physically so could need care for longer than that...
What happens when that money is used up (bar her work & state pension)?
Do we only then apply for Fair deal? Or am I missing something here.... She is joint owner of the house.
 
scatriona said:
What happens when that money is used up (bar her work & state pension)?
Do we only then apply for Fair deal? Or am I missing something here.... She is joint owner of the house.
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Your assumption is correct. You pay for her in the NH using her own funds until her assets have reduced sufficiently to make her eligible to apply for the Fair Deal. Only then should you apply.
 
It is my understanding, from previous threads on this topic, that, even though they may receive no assistance at this time, it is a good idea to apply anyway as the 3 year limit on house/proceeds of PPR, would run from the date of application. Caveat, the time from when I dealt with this is increasing all the time and I've been wrong on this topic before...see above!!
 
You should apply for Fair Deal regardless and let them make the decision. The fact that one was acting as guardian to the other may be taken into account. In my experience, the Fair Deal office can be very helpful
 
Slim said:
It is my understanding, from previous threads on this topic, that, even though they may receive no assistance at this time, it is a good idea to apply anyway as the 3 year limit on house/proceeds of PPR, would run from the date of application.
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If that is correct, then what is to stop anyone from applying for the scheme three or more years before they need it!

The HSE's page about the 3 year limit suggests (to me, although it's not explicitly stated) that the clock doesn't start running until you're in the scheme.

www2.hse.ie

3-year cap on homes, farms and businesses

Read advice on the Fair Deal 3-year cap and how it applies to farm and business owners applying for nursing home support
www2.hse.ie www2.hse.ie
 
Marsupial said:
If that is correct, then what is to stop anyone from applying for the scheme three or more years before they need it!

The HSE's page about the 3 year limit suggests (to me, although it's not explicitly stated) that the clock doesn't start running until you're in the scheme.

www2.hse.ie

3-year cap on homes, farms and businesses

Read advice on the Fair Deal 3-year cap and how it applies to farm and business owners applying for nursing home support
www2.hse.ie www2.hse.ie
Click to expand...
It's the assessment of nursing care need that would trigger the 3 years, regardless of the financial assessment.
 
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