Equity Release and Government Funding

Not everyone who needs care can afford to fund it solely out of income. Below, we explore some of the alternative funding options.

Government funding

Your local authority will fund some or all of your care if you meet certain criteria. If you live in your own home in England and are recognised as needing social care – support to wash yourself, eat meals etc – the amount you pay towards that care depends on the value of your assets excluding the value of your home.

If you have savings below £14,250, most local authorities in England will provide you with free social care. If you have £14,250-£23,250, you will be required to contribute towards your care costs at a rate of £1 per week for each £250 you have (0.4%). And if you have over £23,250 in savings, you won’t receive any state funding for your care.

If you go in to residential care, what you pay towards the cost will still depend on a means-test of your assets. However the critical difference is this test will include the value of your home. If you do go in to a care home, once you have used up your savings, you would be forced to sell your house to continue paying for your care. This is one reason why live-in care in your own home is a far more cost-effective option.

What’s more, if your local authority covers any of your care costs, they will use your pension as a contribution.

There is another option for funding live-in care – via a lifetime mortgage. Please note in giving this information we are not in any way endorsing a particular method of funding.

Lifetime mortgages

Equity release live-in careIt is possible for many people to take out an equity release or ‘lifetime mortgage’ on their home. There are two types of lifetime mortgages, one of them involving monthly payments and the other where no payments are made at all for the duration of the mortgage. With the second type the debt just accumulates and is repaid when the house is finally sold, usually on the death of the person who has taken out the mortgage. Monies released via a lifetime mortgage can either be in the form of a lump sum, or a series of monthly or annual payments, or a combination of the two.

The table below shows in broad terms how much capital could be released in this way.

Maximum Equity Release Mortgage

Based on House Value and Age of Applicant

Age House value £200,000 £300,000 £400,000 £500,000
75 £100,000 £150,000 £200,000 £250,000
80 £100,000 £150,000 £200,000 £250,000
85 £100,000 £150,000 £200,000 £250,000
90 £100,000 £150,000 £200,000 £250,000

Please note the figures in the above table are for illustrative purposes only – the maximum loan available will depend on a range of other factors, including the person’s lifestyle, current health and previous medical history.

Live-in care information pack

Call at any time to receive our comprehensive information pack or click the image below to request it via email.

 08000 807 891


Regardless of the type of lifetime mortgage selected, the homeowner will always own their own home and there is a “no negative equity” guarantee written into the loan, which means that the outstanding mortgage will never exceed the value of the property. Last, but not least, any sums raised through a lifetime mortgage are always tax-free.

If you would like more information about lifetime mortgages please get in touch via any of the methods on the right.

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There was universal praise for carers and they were described as, “wonderful”, and “outstanding”.

#25. CQC inspection 2015

We are profoundly grateful that we found out about the existence of Care at Home.

#7. Close relative of a client in Birmingham

Your carer improved my mother’s quality of life with her wonderful sense of humour and loving care beyond anything we had seen before.

#4. Son of a client in Leicestershire

I am so, so, so happy with the support my aunt has been given. Her carer is excellent & fantastic.

#9. Niece of client in Beccles, Suffolk

Branka’s care was exceptional and we were so lucky to have her looking after Don for the last year of his life, and helping to make him as calm and comfortable as possible’.

#38 Clients daughter in law in Hertfordshire.

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