Skip to main content

Deferred payments for care home costs

You might be able to use the value of your home to help pay your care costs using a deferred payment. We'll pay your care home bills now and you repay us later when you decide to sell your home, or we can be paid back after your death.

You should get independent financial advice to help you decide how to pay long term care costs and make sure you're claiming all the benefits and allowances you can.

Apply for a deferred payment

It takes around 12 weeks to set up a deferred payment agreement.

The agreement will include:

  • the maximum amount that we will pay towards your care
  • the interest rate and any fees charged.
  • conditions such as how the property should be maintained

Before signing a deferred payment agreement, you should get independent advice from a solicitor, financial advisor, or an independent organisation.

Deferred payments policy

Who can get a deferred payment

You should be able to get a deferred payment agreement if:

  • you live in a care home or you're moving into one soon
  • you own your own home and it is insured
  • you have savings and investments of less than £23,250, not including your home or pension
  • you have enough equity in your home 

Applying if your partner lives in your home

If you need care in a care home but your partner lives in your home, we will look at their circumstances as well. We may not include the value of your home when we work out how much you will have to pay towards your care.

If your partner has circumstances that mean the value of your home is included, you can still get a deferred payment agreement if your partner also signs the agreement.

The amount you can defer

The amount you can defer depends on how much your home is worth. We will get a valuation of your property. You can also get an independent valuation if you want to.

Most people use around 70% of the value of their home. We do not use the full value of the home. You need to have enough money left to pay the costs of selling your house and to make sure we have enough money to pay for your care if house prices go down

The cost of setting up a deferred payment agreement

We charge £625 to set up a deferred payment agreement which includes the cost of having your property valued. To cover our costs, we charge interest on the amount you owe us until the money is repaid. The interest rate is set by the government and reviewed every 6 months. From 1 January 2024 to 30 June 2024  the interest rate is 4.65%.

When to repay a deferred payment agreement

You can repay a deferred payment by selling your house or someone else pays the charges. You can have a deferred payment agreement for the full length of your stay in a care home, it will be paid back from the sale of your home after your death. 

The deferred payment agreement is a legal agreement which ends after your death. The executor of your estate will have 90 days to arrange to pay back the money owed. 

Applying for someone who can't understand

Carers and families can help people to make decisions about their care and how to pay for it. If we think the person applying for the deferred payment agreement does not understand the agreement, or will soon not be able to understand it (such as someone with dementia), then another person may need to represent them. Only an authorised like someone with legal power of attorney can represent someone in applying for a deferred payment agreement.