Care home fees can be expensive. The Care and Home Inheritance Plan (also know as CHIP®) offers an alternative to selling your home to fund your care. It gives you the security of knowing your care home fees will be paid and your loved ones will one day inherit your property.
Many people fund the shortfall between their income and their care fees by selling their homes or engaging with the deferred payment agreement with their local authority. This can be a tough decision to make and means that children or loved ones won't inherit the property. The CHIP is here to change that.
The CHIP is an innovation within the care industry brought together by a team of experts in care, property and finance. It enables you to fund the shortfall between your income and your care home fees while you maintain full legal ownership of your property. This unique bundle of services is offered by Shaw Lifetime Care which is 100% owned by The Shaw Foundation, an exempt charity established in 1986 to improve care for older people in the UK.
The Care and Home Inheritance Plan (also known as the CHIP) is a unique bundle of services offered by Shaw Lifetime Care. It is an ethical product that enables you to fund the shortfall between your income and your care home fees, allowing you to maintain full legal ownership of your property.
Shaw Lifetime Care (SLC) will lease your property and take responsibility for the ongoing management of the property. This includes letting, insuring and maintain the property to a high standard.
This means that you will not need to sell your home, and that your chosen recipient can still inherit the property.
The bundle of services includes:
• Paying the shortfall in your care home payments
• Managing the refurbishment of your home
• Funding and organising routine home maintenance
• Letting out the property and sourcing suitable tenants
Shaw Lifetime Care will help you to calculate the difference between your pension and your care home fees. If there is a shortfall, the CHIP can fund the difference for a period of three years.
Following the initial three years, the difference in your care home fees will be covered by a discretionary grant provided by the Shaw Foundation. The Shaw Foundation is Shaw Lifetime Care’s parent company and an exempt charity who champion innovation in the elderly care sector.
Your property will be placed in the care of SLC through a leasehold arrangement.
SLC takes care of your home and lets it out. Even if SLC cannot source suitable tenants, you will continue to receive your agreed CHIP payments to fund your care at no additional cost or effort.
Whilst SLC is responsible for your home during the leasehold period, you or your beneficiaries maintain legal ownership over your home.
After the leasehold period is complete, the property is returned to you or to your chosen beneficiaries.
CHIP is suitable for those moving into a care home who would otherwise have to sell their home to fund their care. If you don’t want to deplete the wealth stored in the property or have the hassle of renting out the property yourselves, the CHIP could be the solution for you.
For many homeowners moving into a care home, letting out the property on their own isn’t an option, as they either lack the time or capacity to do so. Moving into a new care home can be a challenging time, and the CHIP offers much needed support during this period.
The CHIP is a means of protecting homeowners, making sure that they can keep their homes even when they no longer live there.
There are no upfront fees payable to set up the CHIP. Any costs incurred to set up and run the CHIP will be included in the CHIP Lease Break calculation.
These costs are paid back over the leasehold period using the income generated during Shaw Lifetime Care’s management of the property. Once the lease is repaid the property is returned to the beneficiaries.
The payments that CHIP contributes to your care home fees remain at the agreed contribution amounts, even if no suitable tenants are available. While the CHIP agreement lasts for three years, the Shaw Foundation charity will continue to fund your care with a discretionary grant after this period has come to an end.
Should you pass away before the end of the initial three-year CHIP agreement, your outstanding CHIP payments will instead be given as a charitable donation to the Shaw Foundation, so that others can continue to receive the discretionary fund.
Speak to one of our care advisors to learn about CHIP in more detail. We will make a referral to SLC on your behalf, who will be in touch to make the necessary arrangements.