Are you wondering whether you should use
the Nursing Home Loan Scheme to leverage your vacant home to activate the
secured loan provided by the Revenue? This gives you a clear picture from a
reputed nursing home support guide to help you understand the new updates to
the scheme and the 3-year cap.
The Fair Deal Scheme in 2022:
The 3-Year Cap on Productive Assets
The Nursing Home Support Scheme-Fair Deal
is based on the financial capacity and nursing home care needs of individuals.
The state assistance only works as a supplement for the cost of nursing home
care for eligible individuals. The nursing home resident contributes a weekly
amount based on their means, toward the cost of their care, and the state
covers the balance.
A means-tested programme, the Fair Deal
State Assistance Nursing Home Support Scheme, is available depending on the
applicants' financial situation. The capital value of an individual's principal
private residence is only taken into account for the first three years of their
time in care when determining their means.
It is only recently that the new
Amendment passed in February 2022 made the 3-year Cap available to productive
assets as well, such as farms and businesses. Previously, nursing home
residents had to pay an annual 7.5% and couples had to pay 3.5% of the current
value of their assets for as long as they received nursing home care, until and
unless the applicant suffered a sudden and unexpected illness requiring
long-term nursing home support.
Furthermore, the three-year cap now also
applies to proceeds from the sale of an individual's principal primary
residence. This means that after three years, the proceeds from the sale of a
nursing home resident's family home are not included in the financial
assessment for the Fair Deal Scheme.
Who Needs The Nursing Home
Loan Scheme?
This loan, also known as ancillary state
support, is provided by the Revenue and spearheaded by the HSE to people in
nursing homes who have assets such as land and property.
The loan allows Fair Deal Scheme users to
postpone paying for their care until after their lifetime. Securing the loan
with these assets During your stay in the nursing home, you will not be
required to pay your contribution against the property, and the entire cost
will be deducted from your estate after your death.
Applicants must provide written consent
to have a charging order registered against their assets when applying for this
loan. If they are unable to do so, it will require them to appoint an enduring
power of attorney.
Nursing Home Scheme Guide For
Loan Support
Ever since the 3-year cap came into
effect, it has changed a lot of things for individuals looking for a nursing
home loan scheme. Because signing up for this scheme would mean mortgaging the
house or farm to the revenue, the homeowner would not be able to pass on the
house to their children.
It's worth noting that the financial
assessment considers any assets given away in the five years prior to applying
for the Fair Deal Scheme. But if you are taking the loan support, your house or
farm will still work like it used to, rendering the 3-year cap inapplicable
since your home will be under the mortgage.
At the end of the day, you must decide whether you require a nursing home loan or whether you can afford the annual payment for three years and then have your family acquire the home. It's a good idea to look at the Nursing Homes Support Scheme Guide before applying for it. Because you will have a negative impact on your record if you try to sell your house or pass it on to a successor after you have submitted your application.
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