Introduction
When care is needed — whether at home or in a residential setting — many families face difficult financial choices. Equity release is one option that may be considered to help pay for care, but the rules and potential penalties can make it feel like a risky decision.
That’s why the changes in the latest version (May 2025) of the Equity Release Council standards are so important.
What’s Changed?
The Equity Release Council has published a new version of its standards, which now include:
- A new Consumer Charter with a clear focus on fairness, transparency, and consumer understanding.
- A sixth product standard, expanding protections for those who need care.
The Key Change – Early Repayment Charges and Moving in With Family
Until now, if someone released equity from their home and later had to move into a care home, they were typically exempt from early repayment charges (ERCs). This allowed them or their family to repay the loan without facing a financial penalty.
Under the new rules, the waiver of ERCs also applies when someone moves in with a relative to receive care — as long as this is supported by a medical practitioner’s certificate. This reflects the growing trend of people receiving informal care at home, often from adult children or close family.
Why This Matters
This change could make a big difference for families who:
- Want to bring a loved one to live with them rather than opting for residential care.
- Are worried about the financial penalties of repaying an equity release plan early.
- Are already providing care and now need to restructure finances to manage costs.
What You Need to Know
- The waiver only applies with formal medical evidence confirming the care need.
- Not all lenders may adopt the new standard immediately, so check with your provider.
- It’s still essential to get independent financial advice
How Care Navigators Can Help
We regularly speak to families navigating the complex and emotional world of care funding. From checking if you might qualify for benefits or local authority support, to understanding how equity release might fit into your wider care plan, we’re here to provide expert advice.
Final Thoughts
This change offers more flexibility and recognition of the many ways families provide care. It’s a small step — but one that may bring real financial relief to those doing the hard work of caring for a loved one at home.
If you’re unsure how this could affect you, or whether equity release is right for your situation, get in touch — we can help you understand your options.
