Glossary · UK
What is Deferred Payment Agreement?
An arrangement with your council letting you delay paying residential care fees by securing the debt against your home until it is sold or your estate settles.
Full Definition
A Deferred Payment Agreement (DPA) lets someone moving into residential or nursing care avoid selling their home immediately to pay the fees. The local authority pays part of the care costs on your behalf and recovers the accumulated sum later, usually when the property is sold or from your estate after death. The debt is secured by a legal charge against the home, much like a loan. To qualify you generally need to be receiving care in a care home, have your property excluded from the means test (for example because no qualifying relative lives there), and have savings and other assets below the upper capital limit. Councils may charge interest on the deferred amount, set with reference to a government-published rate, plus administrative and legal set-up fees, all of which add to the final balance. You remain responsible for upkeep, insurance and may rent the property out to help meet costs. Schemes operate across England and Wales under the Care Act framework; Scotland and Northern Ireland run their own care-charging rules, so terms, eligibility and capital thresholds differ. Take independent financial and legal advice before signing, as the growing debt reduces what eventually passes to your estate.