Dear Nemesisis,
Yes, this is a problem. My mum's house has just sold for £130,000 so we are in a bit better position than you, but it is still a worry. I agree with everyone on this site, make sure social services understand your position and that the home you choose would be one they would fund if your mum was not self-funding. It might seem strange and unfair, but if you are self-funding, homes charge you more than they do the social services, so don't panic unduly if the home you find is initially more than the SS limit. Discuss with the manager/owner first. I have since learnt that they will negotiate to a point. If they are suggesting £80 a week above the social services level, make a few noises that that is more than you can afford. Suggest £40 a week extra, and negotiate at £50 or £60. And I bet that is affordable out of your mum's house sale.
Your mum is only 75? Mine is 80. We consulted Help the Aged, who have a "deal" with a firm of Financial Advisers, underwritten by HSBC bank, who have been very helpful to us. We are seeing the Adviser again tomorrow, and the figures I quote below are all related to my mum, not to yours, so not to be relied upon for you. For about £50,000 depending on doctor's reports, we can buy a plan that pays £1200 a month (that's the difference between the care home fees and her pension - don't forget to claim Attendance Allowance pronto and backdate the time you felt mum needed help to as early as possible cos there is a six-month delay before it kicks in), which starts in 3 years. You can have any combination of plans, starting in 1 year, 2 years, 5 years, whatever. We (MUm) has to pay for her care in the meantime. From what you say, you would have £30,000 left (plus her pension and Attendance Allowance, £64.50 a week at the highest rate) to pay for the first 3 years, which may not be quite enough. So consult Help the Aged (or others who have expertise in the aged, not just any Financial Advisor, I think they need to have an F8 qualifcation), and see what they can do for you. It is at least worth it just to go through the options.
I assume your mum has no other savings?
An alternative is to NOT sell your mum's house, but rent it out, say £400 a month depending on the area, and if her capital without the house is less that £21,500 (in my area, it does vary), Social Services will fund the home up to a certain level, and you will be expected to top it up if the fees are more that than level, say £70 a week. You could pay that out of the house rental income (think about tax on it though, you might not have £400 a month left over, especially with insurance and other costs), and you might not have a tenant for all 12 months of the year. BUT if the house rises in value, you get that benefit, and can always sell it when you feel the time is right. I wonder where you live, that a 2-bed house is only valued at £80,000 - I suspect in an area where house prices are likely to rise, but I am no expert, so ignore my opinions.
If you don't sell your mum's house, the social services will set up a "debt" against it, such that when it is eventually sold you will have to repay the accumulated debt, but there is no interest charged on the debt, so that is a plus point. The negative point is that you have the stress of managing a rented house, unless you pay an agent to do it for you (with more cost).
I suspect your mum is at the tight end of being able to manage what you want for her, for the rest of her life. I appreciate what you say about not wanting to move her elsewhere, and I think that is important. My mum doesn't particularly like the home she is in (been there 3 months) but she IS getting used to it, and I wouldn't want to move her without a significant reason for so doing. It isn't perfect, but she is as happy there as she would be anywhere else.
Now, what to look for in a care home for your mum, if you are on a tight budget.
Clean, not too smelly (they all smell a bit, all those incontinent old people can't have no smell at all), residents of similar age/condition to herself that she might make friends with (mum has made friends with the most unlikely person imaginable!), bedroom acceptable (don't think that a big room is better than a small room, your mum will adapt more than you think, but I wouldn't go for a shared room cos mum could be upset if the other person is ill, or goes into hospital for a spell - as they do - or dies!). One home we viewed (well, the one we chose) had two very nice little rooms downstairs but they were so cold we couldn't accept them. Think about where your mum's room is in relation to other areas of the home - will she get lost? Most homes fetch residents from their bedrooms to the lounge/dining room in a morning and see them back to bed at night, so the location might not be a problem for your mum.
Do you want en-suite facilities? A toilet and washbasin is useful. Baths and Showers are better if supervised by the staff anyway.
Some homes were quite posh, chandeliers (well, mum's has them, most of the bulbs are out!), antique furniture, forget it. Go for basic and clean. Mum's home has filthy windows (on a main road), but most of the residents don't notice.
But to me the most important criterion was the staff. Those in mum's home have mostly been there 3/4/5 years, they all get on well, have a laugh together, seem to enjoy the job, get on well with the manager (who mucks in as well), the cleaner sits with the residents, so does the cook, and the girl from the office. Course you don't know all that till mum has been there for a while, but our first visit saw the maintenance man putting up new Fire notices and one of the carers was jibing about the positioning of these, and the staff were all laughing. It just gave me a good impression about the workers.
Well, hope all this helps.
I am no expert, but am good with figures, and have just been through this with my mum.
Hope you manage.
Best wishes
Margaret