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Is your home your main asset?

Where your home is your main asset funding options are limited.

Deferred Payment Arrangements

This is where the Local Authority covers the costs of your care but secured on the value of your property, and they recoup the costs after you have passed away when the property is sold.

These arrangements are offered by Local Authorities but only in very limited circumstances.

There are two main restrictions which are that your liquid capital must be less than £23,250 in England and Northern Ireland, different limits apply in Scotland and Wales; plus you must not have a partner or dependent living with you. 

It may not be permitted by your lender if you have a mortgage.

Some useful links are provided below: 

Money Advice Service - https://www.moneyadviceservice.org.uk/en/articles/deferred-payment-agreements-for-long-term-care#am-i-eligible-to-use-a-deferred-payment-agreement

Which - https://www.which.co.uk/later-life-care/financing-care/care-home-finance/deferred-payment-agreement-and-property-disregard-a1k5f8h7t5j2

Oxfordshire County Council - https://www.oxfordshire.gov.uk/residents/social-and-health-care/legal-and-money-issues/paying-care/care-residential-home

Equity Release sometimes known as a Lifetime Mortgage

The main difference between this type of mortgage and an ordinary mortgage is that with this type you do not need to make any monthly payments – interest is added to the amount you owe and repaid to the lender either when the last borrower dies or moves into a care home. 

Because no payments are made it is important to understand that the amount you owe increases over time.

You can raise a lump sum or drawdown money as you need it, subject to certain minimums. 

If you are over 80 you can raise around 55% of the value of your home.

Most providers of this type of loan guarantee that you will never owe more than the value of your home – this protects your family from being pursued by the lender after you have passed away.

Contact us for details of our preferred equity release adviser. 

How we can help

For further information on later life advice, contact Tim Davison on tim.davison@shawgibbs.com or call 01865 292200

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Contact Us

For further information on later life advice, contact Tim Davison on tim.davison@shawgibbs.com or call 01865 292200.

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