Using a Lifetime Mortgage to Pay for Long-Term Care
A lifetime mortgage is one type of equity release plan, used to release money from your home and give you more cash to use in whatever way you see fit.
The money that is released using these lifetime mortgage plans can go towards a wealth of different expenses – from splashing out on luxury items and holidays, to using the money for paying off debts or supplementing pension payments more generally. For some people, they can even become a resource for paying for some of the serious costs that life can throw at you.
Financing Care in Your Own Home
One serious expense that can often strike in later life, though, is the need to pay for ongoing care. If this is something that hasn’t been prepared for, people may find that they don’t have the funds available. There are many care services available that allow you to stay in the home you love, ranging from having meals delivered to your home, to regular visits from a care professional who can assist with both the day-to-day tasks of running your home, and your personal care needs.
Services like these are a great way to retain independence while also receiving the support that you need, so if you think that it’s something you – or a loved one – could benefit from, it’s a good idea to have a payment plan in place. Since many pensioners find that their home is the largest asset that they own, a lifetime mortgage is certainly a viable option for financing a stay-at-home care plan, especially if other options like down-sizing and personal savings have already been exhausted.
Since you’re free to use the money released by a lifetime mortgage in whatever way you see fit, choosing to pay for your home care is always a viable option. However, if you’re moving into a care home things become a little more complicated. This is because moving into a care home will normally trigger the end of your plan – and therefore the money will need to be paid back.
However, if the application was made jointly by more than one person, that money only needs to be repaid once all of the applicants have moved into care or passed away. So, for instance, in the case of a couple who have taken on the lifetime mortgage together, one of you would be able to remain at home while using the funds to pay for your partner’s care home.
There is no one-size-fits-all solution for something as personal as long-term care, but equity release is one option to keep in mind. Find out whether you fit the eligibility criteria by reading our easy guide, you can also use our free online calculator to find out how much you might be able to release.