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If you – or one of your loved ones – have been diagnosed with any form of dementia, sooner or later you may need to learn about the process of selling property as an individual with this condition.
Being diagnosed with a progressive condition is hard enough without having to struggle through the logistics of a property sale at the same time.
In this article, we’ll discuss how to approach this process with as much clarity and transparency as possible to help you get to grips with the next steps.
Contrary to popular belief, dementia is not a condition in and of itself. Instead, it’s something of an umbrella term that covers most illnesses that progressively affect a person’s mental capacity to the extent that their day to day life is affected. The most common form is Alzheimer’s disease.
While conditions of this kind most commonly affect the elderly, it is certainly possible for much younger people to be diagnosed with dementia.
Many types of dementia include symptoms such as memory loss, poor concentration, delusions, confusion, poor judgement and problems with decision making.
This means that people with the condition are likely to find dealing with complex legal processes and important financial transactions difficult – and this issue is likely to worsen over time.
However, the progression of dementia is gradual. This means that, depending on the severity of the condition, a person may be able to successfully manage their own affairs and make decisions unimpeded for many years after their initial diagnosis.
So – can you sell your house if you have dementia?
The answer is that if you are the only person named on the title deeds – and if no additional legal powers have been granted to other individuals in regards to the management of your property and assets – you reserve the exclusive right to sell your home.
However, people with dementia are required to undergo regular medical assessments so that their mental capacity may be monitored.
As soon as it is found that the individual lacks the capacity to make decisions of this kind for themselves, a Deputy must be appointed by the Court of Protection in order for the process to be completed successfully.
Prior to this – that is, following the diagnosis and while the property owner is still legally considered “compos mentis” – it is a very good idea for them to assign Lasting Power of Attorney to a trusted individual such as a friend or family member.
This legal power enables the chosen individual to make decisions on behalf of the principal (the person handing the control over to another party). This can be done without applying to the Court of Protection.
However, it is not possible to arrange Power of Attorney once the principal has been found to lack the capacity to make their own decisions.
For this reason, it’s highly recommended that anyone who has been diagnosed with dementia should take steps to set up a Power of Attorney at their earliest convenience.
If one of your loved ones has been diagnosed with dementia, there may be some big decisions to make. In order to pay for dementia care, selling their house and moving into a residential care home may be the most sensible option.
Alternatively, downsizing and moving into a more accessible property may be preferable – and money from the sale may be used in part towards the payment of live-in or visiting carers.
However, unless you have been named as a Deputy or granted Lasting Power of Attorney, all final decisions relating to the sale of the property must be made by its owner.
Power of Attorney can be arranged online via gov.uk or using paper forms. At the time of writing, this costs £82 per applicant – although reductions and exemptions may be available in certain circumstances.
If the owner of the property has now been declared unable to make their own decisions, you will need to apply to the Court of Protection to become a court appointed Property and Financial Affairs Deputy.
To do this, you’ll need to be 18 or over – and the court must agree that you have the skills required to make financial decisions for another person.
The application will be checked by the court to ensure that appointing a deputy really is the best action to take in your particular case, and to ensure that no one objects to your taking on this role.
You can even apply for “joint deputyship” where multiple people work together to make decisions relating to the principal’s finances and property.
It is also possible to do this “jointly and severally”, which means that deputies can make decisions together or separately depending on the circumstances.
Arranging deputyship can take a number of months and, at the time of writing, an application costs £365 per deputy – with an additional £485 if a court hearing is required, then a £100 assessment fee for new deputies brought on board.
After this, deputies are required to pay an annual supervision fee, which depends on the nature of their involvement with the principal’s finances and property. This may amount to £320 for what is called “general supervision”, or just £35 when managing a budget under £21,000.
Once you have Lasting Power of Attorney, or are named as a deputy, it’s important to thoroughly understand the process involved in the property sale when acting on behalf of another person.
You must first make sure that you have been granted the right Power of Attorney. Your permissions need to cover finance and property in order to sell the principal’s home.
Lasting Power of Attorney needs to be registered at the Office of the Public Guardian before any action can be taken towards the sale of the property.
It’s also important to check whether there is anything in the LPA application that will prevent you from taking certain actions.
For example, it may specify that your access to the principal’s bank account is restricted – which means that you will need permission from the Court of Protection in order to proceed.
Alternatively, it may specify that you will not be permitted to act as an attorney until the principal has been medically declared unfit to make decisions of this nature.
You need to be registered as a Property and Finance deputy in order to make decisions related to the sale.
Whether you have been granted Lasting Power of Attorney or you are acting as a deputy, you will need to carefully check the principal’s will before taking any action involving their property and its contents.
They may wish to leave the home to a loved one, or there may be items within it that they wish to pass down.
You can only access the principal’s will if you have permission as part of the LPA – or if the principal has previously allowed you to do so.
The sale of the property itself is usually fairly straightforward. Estate agents and conveyancers usually have experience dealing with deputies or individuals with Lasting Power of Attorney acting on behalf of the seller.
However, if you are acting as a deputy or have been granted Lasting Power of Attorney, you are expected to always act within the principal’s best interests. This means that you should make every effort to achieve the best possible sale price for the property.
To this end, it is highly encouraged that you seek a number of valuations before deciding on an asking price – and that you investigate the recent sales of similar or comparable properties in the area to be confident that the amount is accurate.
You should then make contact with the property’s insurers to inform them that you are now acting on the owner’s behalf. Include a copy of the LPA or documents naming you the deputy, and ask the insurers to correspond directly with you.
If the principal is moving out to go into residential care, you will need to notify the insurers that the property will be unoccupied.
You should also notify the local council and the water supplier for the property, as, when a homeowner leaves their property to go into care, they will not be required to pay their council tax or water bill.
It is a good idea to have the principal’s post redirected to you as well.
Many individuals affected by a condition that will increasingly impact their mental capacity sell their property in order to cover dementia care costs and fees.
However, in other cases, it may be more beneficial for them to downsize into a more accessible home and hire visiting or live-in carers.
If this is the preferred option, this means that not only will they be selling property, but buying it too.
Again, there should be no problem with this course of action as long as medical professionals have declared them mentally capable of making decisions of this kind.
However, if this is not the case, a deputy – or an individual with Lasting Power of Attorney – will be required to manage the purchase on their behalf.
So – can someone with dementia sell their house or buy property? The answer is yes – as long as they are still considered mentally competent to do so my medical professionals. If not, they must rely on a deputy or an individual who has been granted Lasting Power of Attorney.
Always be sure to consult a legal professional before making any major financial decisions on behalf of another individual.
If you need further advice on selling a property fast, making a sale with a tenant in situ or any other issue relating to property transactions, simply get in touch with our team of specialists today.
You can request a quick cash offer on your property and a free no-obligation valuation, simply by entering your postcode and providing some very simple information.