Homeowner loans to pay for care homes

If you own your own home, you can apply for our deferred payment scheme to help pay care home fees.

Deferred payment scheme

Our deferred payment scheme is a type of loan that can help you pay for care home costs, if you've had a care needs assessment that shows you need to live permanently in a care home.

The scheme is for people who cannot afford to pay for care because all their money is tied up in their home.

How it works

We don’t give you a fixed sum of money like a normal loan. Instead, we pay an agreed amount each week towards the cost of your care, on the condition that you’ll repay us from the money made from the sale of your home.

This might be when you choose to sell it, or after you’ve died.

Interest charges

We charge interest on your loan and secure it against the value of your home.

The maximum interest rate is fixed by the government. This charge is based on the cost of government borrowing and will change on 1 January and 1 July each year.

Who can apply

You’ll qualify for this scheme if you own or part own a property and:

  • have had a care needs assessment that shows you need to be in a care home permanently
  • have less than £23,250 in savings and investments, excluding the value of your property
  • have lived in a care home for more than 12 weeks
  • register your property with the Land Registry at your own expense
  • are able to make your own financial decisions or have a legally appointed agent to make those decisions
  • have proof of building insurance
  • keep the property in good condition to retain its value

Terms of agreement

You must meet the above criteria to be eligible for the scheme.

In addition:

  • the valuation of your property must show there is enough equity to cover any outstanding debt (equity is the value of your home minus remaining mortgage payments)
  • we must be able to obtain a first legal charge on your property (this is an agreement which means the lender will get paid back first when you sell your property)

We will not accept any other securities against the loan.

What it will cost you

You'll need to pay:

  • a one-off fee, including Land Registry charge, for arranging the loan
  • an annual administration fee to us

We'll also need to get a formal valuation of your property. There is a one-off charge for this which we'll add to the total cost of your loan.

If you're not eligible

There are other ways of helping to pay for care homes.

Learn more about paying for care homes

Get financial advice

We’re not allowed to give you financial advice. If you're not sure what to do about the cost of your care, you can speak to a professional for advice.

There are local organisations you can speak to for advice about benefits and care providers, including:

The Society of Later Life Advisers help people to find trusted financial advisers.

Get help to understand

You can ask a friend or family member to represent you, or we can find someone to speak for you (an advocate).

How to apply

Contact our financial assessment team to find out more or to get an application form.

Phone

020 8770 5280 (24 hour answerphone)

Email

fapd@sutton.gov.uk