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Should I act as guarantor for my dad's nursing home fees?

Your questions answered


Email your questions to  lmcbride@independent.ie or write to 'Your Questions,  Sunday Independent Business, 27-32 Talbot Street, Dublin 1'.

Email your questions to lmcbride@independent.ie or write to 'Your Questions, Sunday Independent Business, 27-32 Talbot Street, Dublin 1'.

Email your questions to lmcbride@independent.ie or write to 'Your Questions, Sunday Independent Business, 27-32 Talbot Street, Dublin 1'.

Q: My dad is 81 and he can't manage on his own anymore at home. We have met the local nursing home and there is a space for him, but they require someone to act as guarantor. What does this mean and what should I know before I agree? Mary, Co Galway

The decision to move into a nursing home is an important one and I am sure these are difficult circumstances for all your family.

Before a resident enters a home, he or she must sign a contract of care. This is an important legal document which sets out the rights and responsibilities that both the nursing home provider and the resident will be bound by.

It may be the case that a nursing home requires the resident and also a guarantor to sign the contract of care, either separately or jointly. It is important that both you and your father fully understand what you are agreeing to before you sign the contract.

A guarantor is a third party who agrees to pay a resident's fees if he or she is unable to continue paying themselves. Agreeing to such a financial responsibility is a considerable commitment. Therefore if you are going to be a guarantor, it is essential that you are provided with all of the information you need to understand and assess the practical implications for you, especially how much you could end up paying. This includes outlining the fees that you as the guarantor will be liable for or if that cannot be provided, you should be told how these fees will be calculated in the circumstances where you are required to pay. The law provides specific protections for consumers who enter standard form contracts, including contracts of care. The Competition and Consumer Protection Commission (CCPC) recently published guidelines and a consumer booklet about contracts of care in nursing homes - as well as the obligations of nursing homes under the Unfair Terms Regulations.

If information is not explained clearly, or you are required to sign a contract of care where you will be liable for all costs without the above details being provided to you, you may have a basis to challenge the nursing home provider about the fairness of these terms.

On the CCPC's website (ccpc.ie), there is a guide for residents and their families to help them understand what to expect from their contracts of care. The website also provides a template letter that you can use to write to a nursing home to outline your concerns about unfair terms in its contracts of care.

Finance for new car

Q: I'm considering buying a new car over the next few months and have been looking around for the most suitable finance options. A friend told me about PCPs, which I'd never heard of before. Should I consider a PCP rather than a bank loan? Tom, Dublin

When it comes to borrowing to buy a car, there are three main options: a car loan from your bank or credit union, hire purchase (HP) or a Personal Contract Plan (PCP). The best option for you comes down to your personal circumstances. The main difference you need to be aware of is that with a car loan, you will own the car outright; whereas with HP and PCP, you will not own the car until you have made the very last payment.

With a PCP, you usually pay a deposit - somewhere between 10pc and 30pc of the value of the car. Then over the term of the agreement, you make monthly repayments. At the end of the term, you have three options: you can either pay the outstanding lump sum and own the car; hand back the keys; or enter into another PCP for a new car. The third option will require a new deposit which may come from equity in your old car. HP is very similar to PCP, but the monthly repayments tend to be higher so you don't have such a big payment at the end.

The main advantage of a PCP is that there is usually a quick application process. Also, a PCP's interest rates and monthly repayments are generally lower than with a car loan or hire purchase. However, the reason the repayments are low is because so much of the cost of the car is deferred until the end of the agreement.

With a PCP, ensure that you don't just look at the monthly repayments, but also consider what you will do at the end of the agreement. If you're planning to hand the keys back or trade the car in for a new PCP at the end of your agreement, conditions of the agreement such as mileage restrictions and the condition of the car become important.

Before you buy a car using a PCP, there are a number of things to consider which can help you decide what the right option for you is. First of all, take some time to review your current financial situation to figure out how much you can afford to put towards a car. Consider the deposit, the monthly repayments and what you plan to do at the end. If you are planning on buying the car outright, you will need to think about how you will finance that.

When working out your budget, don't forget about the ongoing running costs, such as fuel, tax, insurance and servicing. You might also consider whether or not you want to own a car - with a PCP, any car won't legally be yours until the balloon payment is paid at the end of the agreed repayment period. You should look at the total cost of the finance too, and check if there are any additional payments you may be liable for, such as administration fees.

Refund and wrong fit

Q: Last week I bought a dress in a shop but I didn't try it on. When I got home, I noticed it didn't fit me. The shop offered me store credit as there were no other sizes available but am I not entitled to a full cash refund? Kate, Co Kerry

People often think they are legally entitled to a refund if they change their mind about a purchase if they take it home and it doesn't fit. However, the short answer is you don't.

If, for whatever reason, you change your mind about something you bought in a shop and decide you don't want to keep it, you do not have a right to a refund under consumer law. Some shops have a policy to accept returns if you change your mind and they will give you an exchange, refund or credit note if you return a purchase within a certain time frame. But all of these options are goodwill gestures and the retailer is not obliged to return your money.

There are two important exceptions to note. If you buy something in store and it turns out to be faulty, you are entitled to request a repair, replacement or refund. There is no time frame in which the fault needs to appear but we always advise that you make contact with the retailer as soon as you realise there is an issue. The other exception is when you shop online from a trader based in the EU. In this case, you would have 14 days from when you receive the product to change your mind and another 14 days to return it for a refund. However, you would usually have to pay for the cost of returning it.

Aine Carroll is director of communications and policy with the Competition and Consumer Protection Commission (ccpc.ie)

Sunday Indo Business