Equity Release for Centenarians!

moneyfinder

I’m hoping to find someone who can advise, preferably from experience rather than theory.

My mother lis 100 years old, and living in her mortgage-free bungalow with the help of live-in care, following a couple of falls and hospitalisations last year. She is generally healthy and happy with her situation. My brother and I have Enduring Powers of Attorney, issued in 1997 following the death of her husband, and we have handled all her financial affairs since. She has no idea of her financial situation or care costs, and no desire to know, and we’re hoping to maintain that.

The live-in care costs around £1600pw, which we are funding at present, with the ‘help’ of £210 pw in benefits and allowances from the local County Council, based on their assessment that she only requires 3 x 45min daily visits! Totally unrealistic, but…..

Our funds are nearly exhausted, and I’m trying to find an equity release scheme to fund the care costs, based on her property value, preferably one which the Council will be able to accept without withdrawing her benefits and allowances; ie no lump sum required, but regular drawdown.

Finding it very hard to find a provider for a centenarian, as most seem to have an entry age limit between 80 - 90!

Thanks for your help.

dunstonh

Equity release will increase the cash held. That in turn will influence any means tested benefits that use cash deposits in the test. So, drawdown would be more appropriate.

However, whilst I don't do equity release personally, I believe that there are no providers that consider over-100-year-olds within their standard terms. It would need a one-off underwriting exception from one of the niche lenders who is feeling particularly generous, as it would almost certainly be loss-making. Under the FCA's Consumer Duty / Product Governance guidelines, going outside of published terms is harder than it used to be.

It is ironic that guidelines brought in to protect consumers also restrict the ability for providers to go bespoke.

In a looser, pre‑PROD world, a lender might occasionally have used discretion to write a very unusual case outside the printed criteria, relying on general Principles and its own credit/risk appetite. Today, the same lender would need to evidence why an over‑100 borrower still sits within the documented target market, why the product has been stress‑tested for that age profile, and how any no‑negative‑equity guarantee risk and exit‑timing risk remain compatible with fair‑value and good‑outcome expectations. Given that lifetime‑mortgage pricing and capital models are built and validated on assumptions that stop well short of 100, it is much cleaner, from a governance and Consumer Duty standpoint, simply to set a maximum age and refuse anything beyond that, rather than treat 100+ cases as “discretionary one‑offs

moneyfinder

Thanks dunstonh for your response. It does explain why I'm having difficulty with the problem, but unfortunately no guidance towards a solution. The number within the age range 90-100+ is increasing rapidly - I'm sure someone must have achieved some sort of success in efficiently sourcing equity release to cover care costs for this group?

Bobziz

For what it's worth Gemini suggests that Aviva have no upper age limit for their equity release offering.

https://static.aviva.io/content/dam/document-library/adviser/equityrelease/pf012013.pdf

Marcon

Aviva only offer a lifetime mortgage and OP needs a home reversion provider.

Bobziz

https://forums.moneysavingexpert.com/discussion/comment/81904803#Comment_81904803

Why is that ?

Linton

Could the council pay making a charge against the house under a deferred payment agreement? They would get their money back when the house is sold. I understand they will do this under some circumstances.

moneyfinder

Thanks Bobziz & Marcon; I am actually waiting for a reply from Aviva on the subject, although the potentially short term nature of any advance may be a sticking point, together with the monthly drawdown requirement. I'm very much hoping to not go down the home reversion route of selling all or part of Mum's house. I'd love to hear from anyone who has managed this?

Marcon

https://forums.moneysavingexpert.com/discussion/comment/81904926#Comment_81904926

Deferred payment agreements apply where someone moves to a care home, not where they require care in their own home.

Marcon

https://forums.moneysavingexpert.com/discussion/comment/81904865#Comment_81904865

A lifetime mortgage would give an immediate cash lump sum, which would mean the likely loss of means-tested benefits and allowances (because OP's mother would have too much capital to qualify). OP has indicated (entirely reasonably) that they would prefer not to lose those.

Marcon

https://forums.moneysavingexpert.com/discussion/comment/81904938#Comment_81904938

I think your best starting point might be an organisation dealing specifically with older people's needs. Have you (for example )asked Age Concern, The Association of Lifetime Layers https://lifetimelawyers.org.uk/Public/Resources/FAQs or perhaps approached SOLLA https://societyoflaterlifeadvisers.co.uk

I'm quite sure this has crossed your mind, but it might be worth revisiting if you've not done so very recently. Have you asked the council to reconsider the amount of help your mum needs? By definition she's getting older by the day, so it's entirely realistic to assume her care needs will also be increasing.