There is an old saying: “You can’t take it with you.” But for thousands of families, their loved one’s house isn’t staying in the family either. Instead, councils are recovering hundreds of millions from people’s estates after they pass away to cover care home bills.
Our analysis of NHS England data shows that local authorities are set to recover £343 million from the sale of homes used as security for care costs. The total debt tied up in Deferred Payment Agreements (DPAs) has risen 40 percent since 2020, as more families rely on councils to help cover care fees.
Looking at the latest NHS England figures, we found that councils signed 3,205 new DPAs last year, a 35 percent increase from the previous year. The total outstanding debt now stands at £343 million, up from £237 million in 2020.
Some councils have a lot more DPA debt than others. Essex County Council tops the list, looking to recover £16 million in care home debt, followed by Lancashire County Council with nearly £14 million tied up in DPAs.
For many, DPAs offer a way to delay selling the family home, but they come with costs. Some councils charge interest rates of up to 4.25 percent, meaning families’ inheritances get gobbled up more quickly. In 2023-24 alone, councils recovered £90 million from deceased people’s estates, with an average repayment of £40,000 per case. Disputes are also becoming more common. One Essex family recently received an £11,000 refund after an investigation found they had been overcharged due to a financial assessment error.
This comes after Labour scrapped a planned cap on care costs originally introduced by the Conservatives. The government has launched a review into care funding, but the final report won’t be ready until 2028.
The full story was published in The Telegraph and can be read at the following link. https://www.telegraph.co.uk/money/property/surge-families-sell-homes-pay-care-home-fees/
