Aged Care Finance Solutions

25/10/2024

Scenario of the week (25/10/2024)

Jeremy (85) lives in his home in Newcastle. Unfortunately, his wife Marie (84) has recently developed dementia and has had to go into aged care.

Jeremy as the Power of Attorney wishes to take out a reverse mortgage to pay her Refundable Accommodation Deposit. He wishes to pay the amount of $250,000 as a partial RAD and then pay a reduced Daily Accommodation Payment.

Jeremy then wants some extra funds for a new car, to travel back overseas and see family, some money to gift to his grandchildren to help them purchase their first homes, and them finally he wants a cash reserve o in case of emergencies and one-off expenses.

Jeremy is a retired actuary, so he has a very good understanding on the loan, the compounding interest and other aspects of the loan. After looking extensively at many options to fund the aged care, he has concluded that a reverse mortgage is the best option for his family. There is a lot of equity left in the property, should Jeremy need to pay for aged care for himself.

If you would like us to review your Reverse Mortgage or to know more about how a Reverse Mortgage can help you achieve your retirement aspirations, please call Raymond on 0438 184 784 or Nicholas on 0438 184 785.

(Names, locations, amounts, & other personal details have been changed to protect the client’s identity. This post does not constitute advice.)

06/09/2024

Loan Scenario of the Week (06/09/2024)

Josephine (96) lived in her home in Newcastle. Unfortunately, she has begun to develop dementia, and she is unable to remain at home. Her granddaughter Evie lives with her and was caring for Josephine, but after Josephine had several falls, Evie is no longer able to do this. Josephine is currently in respite care.

Josephine no longer has capacity to make her own decisions and so the loan will be done under joint power of attorney. The power of Attorneys will be her four children.

Josephine’s is a self-funded retiree. Her husband uses to look after all the accounts. Josephine has not lodged a single tax return since her husband passed a couple of years ago. Her children have just found out about this, and they will use some of the money from the reverse mortgage to pay this debt.

The reverse mortgage will pay for the RAD at the aged care facility that Josephine is going into will go into. They are not sure how much the rad will be, but they are expecting it to be around $800,000.00 to $850,000.00. However, her home valued in at $2.1 million, with her age we could get her up to 56% of the value of the property.

Once Josephine leaves aged care permanently the loan will be repaid by the sale of the house and then the siblings will split the remaining as their inheritance. The children not only get the remaining capital in the property, but the $850,000 from the refundable accommodation bond.

The family are still deciding on what facility to put Josephine into, but they want to begin the process, so they have the funds available when they decide on what aged care facility is best.

If you would like to know more about how a Reverse Mortgage can help you achieve your aged care aspirations, please call Raymond on 0438 184 784 or Nicholas on 0438 184 785.

(Names, locations, amounts, & other personal details have been changed to protect the client’s identity. This post does not constitute advice.)

26/07/2024

Loan Scenario of the Week (26/07/2024)

Alan (93) lives in an aged care facility in Bathurst. He has been there since December 2022 after being diagnosed with dementia and it being deemed to unsafe for him to live at home. Before Alan went into the facility his last wish was that his daughter does not sell his house to pay for, because he built it with his late wife, and it holds a lot of sentimental value for him.

Alans daughter Sophie has respected these wishes and instead of selling the house to pay for the accommodation bond or RAD (refundable accommodation deposit) she is going to do a reverse mortgage as her father’s power of attorney. She will pay the RAD with this loan. Then she will list her father’s house on AirBnb to help cover any shortfalls that he may have. Sophie lives in Brisbane and has to travel to see her father; having the family home as a short-term rental has given her a place to stay to visit her father and she can bring him home for outings so he can still enjoy his home.

Sophie is Alans only beneficiary she is planning on paying the interest monthly on the reverse mortgage herself or using some of the rental income to pay the interest. When she receives the RAD back, she will be able to pay off the reverse mortgage and keep the property.

This loan has allowed Alan to get the required care without parting with his beloved home. His daughter will still receive her inheritance and having the home has made her life easier when going to visit Alan.

If you would like to know more about how a Reverse Mortgage can help you achieve your lifestyle aspirations, please call Raymond on 0438 184 784 or Nicholas on 0438 184 785.

(Names, locations, amounts, & other personal details have been changed to protect the client’s identity. This post does not constitute advice.)

31/12/2023

The team at Reverse Mortgage Finance Solutions would like to wish you are your family a Happy New Year. We look forward to continuing to help our clients in the New Year.

25/12/2023

The team at Aged Care Finance Solutions would like to wish you are your family a Merry Christmas. We hope it is a happy and joyful day.

26/05/2023

Loan Scenario of the Week (26/05/2023)

Anthony (aged 85) is in residential aged care. In November 2022 Evan (who is Anthonys son and Power of Attorney) made the hard decision to put Anthony into care after a recent decline in health.

He currently has an existing Reverse Mortgage with a balance of approximately $190,000 that must be repaid now that he has permanently left the security property. Evan is Anthony’s son and the Power of Attorney. Evan (the PoA) lives in the security property.

Anthony has been granted protected person status from Centrelink which has reduced the asset value of the property for aged care fee purposes. Thus, the aged care fees are only 85% of Anthony's pension. However, the property maintenance and extra medical costs of Anthony mean there is a monthly shortfall in Anthony's income. Evan is not in a financial position to pay rent or further support Anthony and if he does it will increase the Aged Care fees.

Recently, Anthony had to attend some rehab care which they thought was going to be included in his current aged care costs. Unfortunately, it was not and had to be paid so this has been deferred to a payment plan.

This loan is to pay out the original Reverse Mortgage and bring the rehabilitation debt up to date, make up the shortfall in income that is occurring every month and to have extra funds available for property maintenance and aged care and health care costs of Anthony. It has provided Evan, with a great deal of comfort as he no longer needs to worry about how he will afford his fathers’ care.

If you would like to know more about how a Reverse Mortgage could help you, please call Raymond on 0438 184 784 or Nicholas on 0438 184 785 and we will be happy to see if a Reverse Mortgage is correct for you.

(Names, locations, amounts, & other personal details have been changed to protect the client’s identity.)

15/10/2021

05/03/2021

We have to keep an eye on the charges and what they are for!

Her daughter says the 90-year-old may have ended up broke in two years if she hadn’t asked questions.

05/03/2021

This seems to sum up the aged care sectors treatment - from the Townsville Bulletin

04/09/2020

After Covid19 started we thought we would see an increase in aged care loans as families would have trouble selling properties to pay for aged care. This has not happened as much as one would think. What we have seen is a big increase in loans to pay for aged care in the home. It seems more people are staying out of aged care, but they need assistance. Government Aged care packages only help so much and if you need more care then it costs. A family can use their parents home to access funds to pay for aged care in the parents home.