Funding your own care home placement

If you are considering moving to a residential or nursing care home, you will need to think carefully about how you choose to fund your stay.

There are several options available, but before you decide which is right for you, we always recommend independent financial advice. 


 

Use savings and/or income from investments or property

You may have the option to use your own savings or investment income to fund your care home stay. If you are considering this you should first get independent financial advice. 

Selling your property

You may wish to sell your property to pay for your care home fees. There are also other options other than selling your property, such as equity release schemes or a deferred payment agreement. 

Care fees plans

A care fees plan requires a lump sum payment to an insurer who will then guarantee to cover residential and nursing fees for the rest of your life. Fees are paid directly by the insurer to the care home provider.

Equity release

There are various types of equity release schemes on the market. These can include schemes where you take out a lifetime mortgage, with the amount you have borrowed being paid back plus interest, upon death or sale of the property. 

There are also schemes where you sell a share of your property, while remaining in the property. When you die or move into a care home, the property is sold and the equity provider receives their share from the sale. The main features of equity release schemes are:

  • There will normally be an arrangement fee charged
  • Interest will be charged and added to the loan
  • Your property is taken as security for a loan
  • The loan will be repaid either upon death or sale of the property.

Rental income from your property

You could generate rental income from your property to help towards your care home fees. A family member could help you with arrangements for managing the tenancy, or you could get help from a letting agency. They can help you:

  • Find a suitable tenant
  • Administrate a tenancy (for example, checking references, drawing up a tenancy agreement and schedule of conditions)
  • Collect rent from tenants
  • Manage your property.

There will be fees payable to the letting agency for any service provided. It is important to choose a reputable letting agency, ideally one recommended to you by family or friends and to understand the fees they will charge and the level of service they will provide.



Short Term Leasing Scheme

We offer this scheme to landlords who want a short-term and hassle free tenancy in their property. The scheme enables you to rent out your existing property and earn income, which can be used towards your residential or nursing care home fees:

  • Monthly payments in advance
  • The property returned with vacant possession
  • All legal documents prepared (lease and tenancy agreements)
  • Quarterly inspection of your property
  • A professional management service
  • Landlord Forum membership.


 

Empty Property Grant Scheme

If you decide to move into a care home, your existing property may be left empty. This scheme enables you to earn rent income from the property, through a Council tenancy which we will help to arrange and manage.

If the property is in need of renovation and has been empty for at least six months, you may also be able to apply for a Renovation Grant of up to £25,000.


 

Deferred Payment Scheme

We can offer you a loan to pay towards your care costs, which is secured against the value of your home. You will not receive a lump sum of money as with a normal loan, but instead we will pay an agreed weekly amount towards the costs of your care. We call this a 'deferred payment'.  


 

Useful contacts: 

Richmond Citizens Advice Bureau
Address: Citizens Advice Richmond, 5th Floor, Regal House, 70 London Road, Twickenham, TW1 3QS
Phone: 020 8712 7800
Web:www.citizensadvicerichmond.org

Money Advice Service
Address: The Money Advice Service, Holborn Centre, 120 Holborn, London, EC1N 2TD
Phone: 0800 138 7777
Web:www.moneyadviceservice.org.uk
Email: enquiries@moneyadviceservice.org.uk

Richmond Council Charging Helpline
Phone: 020 8831 6400
Email: charginghelpline@richmond.gov.uk