A CAUTIONARY TALE

Stan and his son Peter lived in the same part of town. Stan’s was the old family house and, now that he was widowed it was, he agreed, a bit big for him. One day when he was having tea with Peter, his wife June and their four children in their little three bed semi an idea was born. Stan can’t remember who suggested it first, but before the month was out, Stan had moved into the little semi and Peter, June and their kids were in the family house. “We’ll carry on paying the mortgage on our house Dad”, said Peter “and we’ll get your old place sorted out too – new kitchen, conservatory, nice bit of decking in the garden and so on. But look, don’t tell our Susan in the States, she wouldn’t understand.”

Everything was fine for a few years, Stan was snug in the semi, the old house was full of children’s voices and the money and effort Peter and June put in to improving it really showed. Stan and Peter handed each other the post that arrived, including the annual mortgage statements on the semi. Then one day Peter sad “Dad I’ve just been told that, if you go ga-ga and have to go into a Home, our house (sorry Dad I mean your house) will have to be sold. Why don’t you give it to me and June now, then they won’t be able to get at it? Our Susan’s OK, she’s worth a mint and anyway, you could give her your savings when you die.”

So Stan went to see his solicitor Gillian. She had thought he was still living in the big house. She said he should have talked to her before swapping houses. She explained he had no security of tenure at the semi. If Peter and June didn’t keep up the mortgage payments or got divorced, he could lose his home. It could take years of expensive litigation to get them out of the house. By letting Peter and June spend money on the old place, Stan had let them build up part ownership of it anyway. Oh and there was the capital gains tax, on the increase in both houses. They’d all lost their exemptions by swapping.

“And don’t give yours to them” she said, “even in exchange for a right to occupy the semi. You’re still at risk of being assessed as owning it if you need care, as well as all the other problems”. Well Stan wouldn’t listen. He insisted on going ahead. Gillian protected him as best she could,  but she knew it might not be enough.

Peter lost his job when the recession hit. The mortgage went unpaid, the stress meant he and June split up, the semi was being sold over his head. Maybe it was that caused Stan’s stroke. Anyway, he’s in a Home now. June and the children are still in the big house. The council say it is Fred’s ‘notional capital’ because he only gave it away to avoid paying for care, so he doesn’t know where he’ll go when his savings run out.

If only he’d come to me first, not last. With proper advice at the right time, everyone could have benefited. Remember, your first meeting with me is ‘no obligation’. Don’t delay!