Equity Release Loans For Long Term Care
Equity release loans, or lifetime mortgages have been around now for many years and can be used for a wide range of purposes, from enhancing income in retirement, paying off existing loans and other debts, buying a holiday home, or helping family with a deposit for a new house, just as a few examples.
One provider of equity release loans has now introduced a plan specifically designed to pay for the cost of long term care funding, or nursing home fees, without forcing the individual to sell their home in order to fund the expenditure.
Partnership have launched the new loan, which is called the Care Plan Payment Option (CPPO) and works along the lines of a traditional equity release loan, where the loan interest charged is rolled up into the debt and no monthly repayments are made, with the loan being repaid on death or sale of the property.
In the past, many people have seen their children’s inheritance eroded, or even wiped out completely, by having to sell their house in order to pay for nursing home fees and it is hoped that this plan will go some way to reducing this financial burden.
Partnership recently announced that it was to introduce an equity release loan product which would provide an additional lump sum or income above a traditional loan, for those with impaired health.
Chris Horlick of Partnership said “For many people, the most realistic way to fund care home fees is through the sale of the family home.”
“Whilst the property must be vacant at the time the Care Plan Payment Option completes, the loan enables the property owner to rent out the property once the CPPO loan has completed. There is also the option to return home should the services of a care home no longer be required.”
