Page 13 - CPB March 21st

OPTION
Maintain the status quo for a number of years with a view to transfer the property back to estate entirely debt-free.
OPTION
Sell the property and receive the net proceeds of sale.
OPTION
Transfer the property to the customer’s Estate.
1 The Care Property Bond provides that the rental arrangements could remain in place following the customer’s death. Any remaining funds from the initial 5 years’ equity withdrawal will be used to repay the equivalent portion of the mortgage debt. The rental income, net of outgoings associated with the property, would then be used to pay down the outstanding mortgage debt over some years, together with any associated tax, charges and expenses of Shaw Insurance Group. It is important to note that for this option to be possible, the customer’s estate must have enough funds to settle any Inheritance Tax due in relation to the transfer of the property. Inheritance Tax is payable in one lump sum within six months of the customer’s death, although it may be possible to opt for a payment plan to settle any Inheritance tax over ten instalments (although note that HMRC will charge interest on the outstanding balance of Inheritance Tax due).
2 The Care Property Bond provides for the sale of the property in the open market. Subject to instructions from the Personal Representatives, Shaw Insurance Group will handle the sale and return the net proceeds (after repayment of the outstanding mortgage debt together with any associated tax, charges and expenses (including estate agency and conveyancing charges) to Shaw Insurance Group). Any remaining funds from the initial 5 years’ equity withdrawal will be used to repay the equivalent portion of the mortgage debt.
3The Care Property Bond provides for the transfer of the property debt-free to the customer’s estate for a price equal to the amount of outstanding mortgage together with any associated tax, charges and expenses of Shaw Insurance Group such as legal and other fees. Prior to the transfer, any remaining funds from the initial 5 years’ equity withdrawal will be used to repay the equivalent portion of the mortgage debt.