What Financial Decisions Include
Financial decisions typically involve :
- Paying everyday bills and household expenses
- Transactions related to property such as buying, selling, or renting
- Managing bank accounts and credit cards
- Borrowing money and dealing with loans
- Handling insurance, mortgages, and other financial products
Legal Authority in Financial Decisions
If you lose the capacity to manage your finances, only someone with legal authority, like an attorney designated in a lasting power of attorney, can make these decisions for you. In absence of such a setup, the Court of Protection can intervene by :
- Making one-off or multiple decisions about your finances
- Appointing a deputy to manage your financial affairs
For welfare benefits, an appointee can manage your benefits and use them in your best interests.
Planning Ahead
To prepare for a future where you might lack capacity, consider :
- Setting up a lasting power of attorney specifically for financial decisions
- Creating a will, as an attorney cannot make a will on your behalf
Dealing with Borrowed Money and Contracts
When you borrow money, it's a contractual agreement. If you lacked capacity at the time, the contract might be voidable, but usually, you're expected to adhere to its terms. If there were issues like mis-selling or undue pressure, you might have legal recourse. Always seek advice from reputable debt or legal advice services for the best course of action.
Navigating Necessary Goods and Loans
Even if you lacked capacity :
- You might still owe a reasonable amount for necessary goods and services.
- If you believe a loan was mis-sold or you were pressured, you might be able to challenge the terms or negotiate the repayment.
Mortgage or rent arrears can put your home at risk, so it's crucial to seek advice promptly if you're struggling.