Elderly client obtains a lifetime mortgage to pay for care costs
- Client required regular care in his home, but was being forced to dip into his savings to pay for this and family members were also having to help out
- The recommended lifetime mortgage paid off his existing mortgage and allowed him to access sufficient income – via a drawdown facility – to pay his care costs and other bills
Client’s circumstances
A man aged in his 80s with a property worth £750,000 and a mortgage for £150,000 secured against it.
Issues addressed
The client had minimal income, but because of his care needs, he was spending £22,000 per year on his care (while remaining in the property) and on the costs of running the home.
His savings were being rapidly depleted by these ongoing costs, even though his family were providing financial assistance.
Another brokerage firm had already said that it could not assist him, and he was increasingly worried that he would be forced to leave his home.
Tailored solution provided by John Lamb Hill Oldridge
Due to our knowledge of the market we were able to source a lender that would accept our client’s property. Our recommendation was for a lifetime mortgage that provided enough to pay off the existing mortgage and repay the funds lent to him by family members in the past.
The lifetime mortgage had a drawdown facility so he was able to access income of up to £22,000 per year for at least 10 years, enabling him to meet his care costs and the costs of running the home.
Although the client’s health situation was such that he was unlikely to live for 10 years, this recommendation provided him with the peace of mind that his bills would be taken care of were he to live that long.
The drawdown facility arranged allows for minimum withdrawals of £2,000 at a time. This was important as we needed to ensure that the client had minimal savings in his accounts otherwise this could impact on the financial support provided by the local authority.
It is essential that we understand our clients’ circumstances when arranging a lifetime mortgage as releasing capital from your property can impact on other factors such as finance support for care or means tested benefits, such as pension credit.
This is an example of how a lifetime mortgage can be used to pay for care costs and other ongoing bills, and how a lifetime mortgage can be set up with a drawdown facility which allows a client to access additional income. The case also illustrates how John Lamb Hill Oldridge can assist clients who have been declined by other brokers.
Other Insights
‘Delaying life insurance is not a neutral decision’ published in FT Adviser
Delaying life insurance planning can lead to higher premiums, reduced insurability, and limited flexibility, particularly where cover is intended to support inheritance tax planning. Acting early can help secure more favourable terms and ensure protection [...]
Our latest podcasts from Ken Maxwell and Paula Steele are now available
Our podcasts page is packed with valuable insights and professional viewpoints surrounding some of the biggest issues in the world of protection. The latest two are now available to listen to, along with our back [...]
John Lamb Hill Oldridge shortlisted for UHNW Private Client Services of the Year at the Citywealth Magic Circle Awards 2026
John Lamb Hill Oldridge has been shortlisted for UHNW Private Client Services of the Year at the Citywealth Magic Circle Awards 2026, which will take place in London on 13th May 2026. These awards celebrate [...]