If you are entering aged care, the aged care providers may ask for your family member or legal personal representative (LPR) to sign a guarantee. This is completely normal and every provider has a slightly different policy around it.
It is not compulsory for a guarantee to be provided, but if it is part of the admissions process and if your family declines to sign, you may not be offered a place.
The guarantee covers payment of all fees and any damages you may cause in care.
Aged care providers may ask for guarantees to protect their ability to recover unpaid fees or any other amounts owing under the agreement. These amounts may include payments towards the RAD if the RAD or mixed combination payment method was selected in the contract (due 6 months after the date of permanent entry).
Aged Care Providers sometimes experience children (who have control over finances) draining their parent’s bank accounts or failing to plan adequately and do not meet their financial obligations.
The Resident Agreement is only a contract between the resident and the provider and if fees are not paid the option exists to sue the resident, but this is very difficult to do so and leads to bad publicity. So, some facilities ask the family for guarantees to ensure the fee obligations are met.
Ensure that you have both Enduring Powers of Attorney (Financial and Personal) and Enduring Powers of Attorney (Medical Treatment). These are two separate documents. If you lose capacity, only an attorney appointed under these instruments can make decisions on your behalf
(including decisions such as signing a contract to enter an aged care facility).
It is important that you seek legal advice to understand the risks and obligations.
Hi Shaun,
Just need some help please. In regard to the below,
“If you are entering aged care, the aged care providers may ask for your family member or legal personal representative (LPR) to sign a guarantee. This is completely normal and every provider has a slightly different policy around it”.
Could you please give some more information in regard to the above?
The Aged Care Home my Father is in Respite care in at the moment has stated that if we opt for a rental style payment option for him, they require the Title of his house as it’s paid off.
I don’t mind to be a guarantor and can actually help to pay for the rental style fees but we are not prepared to hand over the Title of our Father’s house to them. This has made us very nervous.
Kind regards,
Maria Ziada
Hi Maria,
Thanks for the comment. I haven’t heard of any facility ever asking for the actual title, but asking the person to be a Guarantor or lodging a Caveat is more common. They basically just want their bills paid.
I would clarify with the Aged Care Home – ask them if they mean the actual title itself or a Caveat over the title. If they do want the actual title, I’d recommend speaking with a Solicitor who does Conveyancing.
If you do need help on this or whether paying the DAP/rent is the best option or other considerations – then feel free to give us a call on 1300 000 243.
Thanks for the message
Shaun Ganguly