Care home finance for equipment and cash flow

For an established operator, care home finance means funding the running and improvement of the business: wages while fees are outstanding, equipment, refurbishment and tax bills. We do not arrange property finance or loans to buy, build or extend a care home.

The cash pattern is steady but stretched. Staff are paid weekly or monthly, while local authority fees follow each council's own payment timetable, which may be in advance, in arrears or on a four-weekly cycle. Queries over assessments or new placements can delay payment further.

Occupancy drives everything. A few empty rooms for several weeks can turn a comfortable month into a tight one, because staffing levels cannot always be reduced to match.

• Wages while council and NHS fees are outstanding: invoice finance can advance cash against invoices to public bodies. Many providers focus on these debts rather than fees owed by individual residents.
• Refurbishing rooms, bathrooms and lounges: unsecured business loans can fund redecoration, flooring and furnishings without a charge over the building.
• Beds, hoists, nurse call and laundry equipment: equipment leasing or business hire purchase spreads the cost over the working life of the kit.
• Minibuses and pool cars: vehicle finance can fund transport for residents' outings and appointments.
• Short-term gaps: working capital loans can cover a dip in occupancy or a run of agency shifts.

Structural work such as extensions or new wings is usually property finance, which we do not arrange.

Lenders look at the quality of care as closely as the numbers, because a poor inspection can quickly affect occupancy and council placements.

• Registration with the CQC in England, the Care Inspectorate in Scotland, Care Inspectorate Wales or the RQIA in Northern Ireland
• Your latest inspection rating and whether any enforcement action is open
• Occupancy levels and how they have moved over the past year
• The mix of self-funded, local authority and NHS-funded residents
• Staff costs as a share of income, including agency spend
• Which councils you contract with and how promptly they pay

• Filed accounts and recent management accounts
• Recent business bank statements
• Your registration certificate and latest inspection report
• Occupancy reports and a breakdown of fee rates by funder
• An aged debt report split between councils, NHS bodies and private payers
• Local authority contracts or placement agreements
• Quotes for any refurbishment or equipment

• Resolve council invoice queries quickly and keep placement agreements on file. Disputed invoices are harder to fund.
• Refurbish in phases so rooms are out of use for as short a time as possible.
• Build National Living Wage increases, which usually take effect each April, into your forecasts and fee negotiations.
• Address inspection actions before applying where you can. Evidence of improvement helps lenders.
• Keep equipment finance separate from day-to-day facilities so you can see what each costs.

We are a commercial finance broker, not a lender. We help established limited companies, LLPs and partnerships of four or more partners that operate care homes find suitable lenders on our panel for operating finance.

You will have a dedicated relationship manager, a real person available by phone, email and chat from your first enquiry until the lender pays out the funds. They will explain how lenders on our panel view registration, ratings and occupancy, and what each is likely to need.

We do not charge you a fee. The lender pays us a commission when the finance completes, and you can ask how much it is. Commission can differ between lenders. You can check your eligibility in about 60 seconds without affecting your credit score. Lenders run their own credit checks later, if you apply, and make their own decisions.

Can a care home rated Requires Improvement get finance?

Possibly. Some lenders will consider it, particularly with an action plan and evidence of progress, while others prefer a Good or Outstanding rating. An Inadequate rating usually narrows the choice considerably.

Can invoice finance include privately funded residents?

Some providers will consider it, but many limit funding to fees owed by councils and NHS bodies. Ask how each lender treats private fees and third-party top-ups.

Do you arrange finance to buy a care home?

No. We do not arrange property finance or care home purchase finance. We help established operating companies with finance for running and improving their homes.

Can a group with several homes apply?

Yes. Lenders usually look at the group as a whole, but may ask for occupancy, ratings and figures for each home.