Aged Care Loans

Jun 20, 2022

Aged Care Loans : What you need to know.

Moving into aged care can be a stressful and expensive process.  Often, there are a number of things to consider. Let’s look at aged care loans as an option for paying for the care.

Aged Care Loans

Aged care providers often have a number of ways for people to pay for accommodation at the facility, most commonly they will ask if you wish to pay via an upfront Refundable Accommodation Deposit (RAD), a Daily Accommodation Payment (DAP), or a combination of both. There are usually supplementary charges payable for the care provided as well.

In addition to their complexity, these fees can be quite high (the RAD regularly exceeds $500k in major cities) and may even cost more than what can be afforded on the age pension. Quite often people feel they need to sell their property to pay for their aged care fees, especially the RAD. However, you may also be able to access the funds from your home without having to sell with a reverse mortgage.

A reverse mortgage is just like a regular home loan, however it has been designed especially for the needs of seniors. It allows Australians aged 60 and over to release the equity in their home to live a better retirement. No regular repayments required, the interest is added monthly to your account and the debt is then repaid from the future sale of the property.

Heartland Seniors Finance is Australia’s leading reverse mortgage provider and offers reverse mortgage options that could help.  Our products can be used to finance aged care costs. This provides flexibility and breathing space for seniors and their families during what can be a stressful period.

Heartland’s products include our Aged Care Option, a five year loan which provides the ability to borrow against a residential property to fund care costs, which can result in a number of potential financial and emotional benefits, including being able to renovate and retain the family home, making care decisions less stressful.

Financially, using a reverse mortgage allows homeowners to sell the home when they are ready, which does not necessarily coincide with when aged care is required.

Like all mortgage loans, applications are subject to loan approval criteria, and fees and charges will apply. Independent legal advice is compulsory and, as the interest is added monthly to your loan, financial advice is recommended.

How can you access the funds?

One of the great features of a Heartland reverse mortgage is the flexibility it offers. Multiple drawdown options and the ability to repay, in full or in part, at any time without penalty, are key features which contribute to Heartland’s product receiving awards with both Canstar and Money Magazine. This includes:

Multiple Drawdown Options

  • Upfront, to cover the RAD payment.
  • Regular advances, to cover the DAP and other ongoing care payments.
  • Cash Reserve (like a “line of credit”) – for future needs and unforseen expenditure.

Repayment

  • Partial repayments are allowed at any time.
  • In full at any time without penalty.

Protection*

  • Never owe more than the net sale proceeds of the property.
  • No repayments are required for the term of the loan.

If you, or a family member, are in, or moving into care and would like to access the equity in your home to do so, Heartland Seniors Finance may be able to help you.

More Information about Aged Care Loans

If you would like further information to see how a reverse mortgage could help you, please feel free to contact our friendly team at enquiries@seniorsfinance.com.au or 1300 889 338, or visit our website www.seniorsfinance.com.au.

 

IMPORTANT NOTICE: This information has been prepared without taking account of the needs, objectives, or financial situation of any particular individual. Applicants should consider their own circumstances and, if necessary, seek professional advice. Applications are subject to loan approval criteria. Terms, conditions, fees and charges apply. Credit provided by ASF Custodians Pty Ltd (ACN 106 822 780 / Australian Credit Licence No. 386781). *Subject to complying with the terms and conditions of the Heartland Reverse Mortgage, you will not owe more than the net sale proceeds of your home and you can keep your home for as long as you choose.

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