A new template document is making it easier for intending residents to compare each village's offerings side-by-side.
The process of selecting a retirement village can be daunting for prospective residents. The raft of paper work handed to them after visiting a village can be overwhelming for people who aren’t familiar with all the RV jargon. What’s a disclosure statement? How does the Code of Practice differ from the Code of Resident Rights? Is an Occupational Rights Agreement (ORA) the same thing as a Licence to Occupy (LTO)? What does the deferred management fee (DMF) cover?
All this paper work is necessary – in fact, it must be provided by law so that people can make a decision to move to a village with full disclosure and transparency. All intending residents must also have proper legal advice and the operator cannot counter-sign the contract without an affirmation from the resident’s solicitor to say they’ve been given that advice.
The Retirement Villages Association (RVA) supports this approach.
“It’s in everyone’s interests that the decisions are made with full knowledge and understanding what’s involved,” says RVA executive director John Collyns. “We also urge intending residents to discuss their decision with their families. All too often we see children misunderstand what their parents’ contracts mean, and an early discussion will ease that concern.”
However Collyns acknowledges that it can be difficult to distinguish one village’s offering from another, especially if some of the key details about costs and fees are buried in the body of the documents.
The RVA has introduced a ‘Summary of Key Terms’ template document to help bring the key information to the fore and make things clearer for intending residents. It was launched last November.
The document is simply a double-sided A4 page that sets out the village’s offerings. It includes:
- Details of the deferred management fee (DMF) and the method of calculation;
- Details of the weekly fees, how they can be increased, and when they stop when the resident leaves the village;
- Details of any other fees payable by the resident;
- Whether the resident shares any capital gain or is liable for capital loss, and if so, how it’s calculated;
- When the resident or their estate receives the capital refund;
- Whether there is any home, hospital, dementia or other specialist care available;
- Whether the resident has priority over non-residents when transferring to another unit or when moving to care;
- How the DMF is treated for any move to another unit or to care.
The Summary of Key Terms allows people to compare each village’s offerings side-by-side. The RVA’s hope is that it will save intending residents time and effort wading through pages of legal documents to find and compare the relevant information.