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Residential Care Loans

This article was written by Phillipa Shaw.

While the Crown’s Residential Care Loan scheme is not available to many people it is something to be aware of as an alternative if you are not eligible for a Residential Care Subsidy and meet the scheme’s criteria.

If you are living at home and assessed as requiring long term rest home care but you are not eligible for a subsidy due to the value of your home, then you may be able to apply for a loan.

The scheme is discretionary and the Crown is not obliged to offer a loan. The purpose of the loan is to assist people to adjust to the change in their circumstances and allows time to make the decision to sell the family home and time to get it ready for a sale if necessary.

To be eligible for a loan you must not have assets of more than $15,000 for a single person or $30,000.00 for a couple in addition to the home, and your home must provide sufficient security for the loan. A caveat will be lodged on the title to your home and the Crown require this to be the first security on the title, that is, that there are no current mortgages.

If the Crown approves a loan, then after all the paperwork is completed the Crown will advance payments to the rest home as required until such time as you reapply and are assessed as eligible for a subsidy.  Or there may be a specified limit or end date to the loan.

The loan is interest free (if repaid within the required timeframe) and is due to be repaid either upon the sale of the home or within a year of the death of the applicant.

This is a broad outline of the scheme, if you think you may be eligible or wish to find out more in case you find yourself in this position, you should seek legal advice from someone experienced in this area of law. At Harmans we have a specialist seniors team to help you with any queries you may have. Give Phillipa Shaw a call on 352-2293 to arrange an appointment to discuss your situation. 

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