> ## Content Index > Fetch the complete content index at: https://millionaire-marketing.ghost.io/llms.txt > Use this file to discover other available public pages before exploring further. # The Refund That Waits for the Next Resident - URL: https://millionaire-marketing.ghost.io/the-refund-that-waits-for-the-next-resident/ - Published: 2026-10-19T11:09:00.000Z - Updated: 2026-10-19T11:08:59.000Z - Author: John Stone A continuing care retirement community asks for a payment on the way in that has no equivalent in ordinary housing. New York's financial regulator puts the range at roughly 200,000 dollars to a million, on top of a monthly fee of about 2,000 to 5,000\. In exchange the resident gets an apartment, services and, depending on the contract, a promise about care costs later. Most of these contracts describe the entrance fee as partly or wholly refundable when the resident leaves or dies. That is true as a matter of contract. What the contract usually also says, in a clause families read quickly, is when the money is paid: after the unit has been re-occupied. Federal auditors reported in 2010 that refunds were usually contingent on a new resident moving in, and that falling occupancy had lengthened the wait by months. A Senate committee the same year was blunter, noting that communities advertise fees as fully refundable but repay only when a new tenant is found, and that in California repayment could take ten years. ### What the Contract Types Actually Buy There are three contract types plus a rental variant, and the difference is who carries the cost of care. A Type A, or life care, contract covers housing, amenities and specified health services including long-term care, with the monthly fee not rising as the resident's care needs rise. A Type B contract covers a set number of nursing days at no change in fee and then charges a full or discounted daily rate; one community auditors examined gave 60 days and then a 10 percent discount. A Type C contract is fee-for-service: housing covered, care paid for as it is used. The entrance fee tracks that risk transfer. In the eight communities auditors visited, Type A fees ran from 160,000 to 600,000 dollars and a rental arrangement with no care promise from 1,800 to 30,000\. For Type C residents, nursing care ran 8,100 to 10,000 a month besides. ### The Mechanics of a Refund Conditioned on Re-Occupancy Tie those facts together and the structure is clear. The refund obligation is real, but the community does not fund it from a reserve set aside for the purpose. It funds it from the next entrance fee, paid by the next resident of that unit. The refund is not a deposit returned. It is a claim on a future sale. That makes the timing of a family's money a function of the sales market for senior housing in that zip code, at the moment someone dies or moves to a nursing floor. Occupancy across these communities was 91.1 percent in the second quarter of 2025, a healthy number. It was not healthy in 2009, which is when the long refund waits were documented. The same arithmetic explains the fee increases. A survey of more than 220 senior living finance officers put the average 2025 monthly fee increase at 4.69 percent for independent living. The average entrance fee increase projected for 2026 is 5 percent, with a maximum of 20. ### What the States Require Oversight is uneven and old. A 2009 count found 38 states with continuing care regulation and 12 plus the District of Columbia with none. Of the 38, 30 required a cooling-off cancellation right, with windows from 7 days after signing to 90 days after occupancy. The financial requirements are where the variation bites. Periodic actuarial studies are required only in California, New York and Texas, and only for communities that guarantee long-term care. Debt service reserves ran from six months in Illinois to a year in California, Florida and Texas; Wisconsin required none. A Senate chairman noted in 2010 that only 17 states required viability studies at all. ### Where the Money Sits When It Fails For fifteen years the answer was academic. Auditors wrote in 2010 that few communities had failed and bankruptcies were rare. That is no longer the position. One account published in July 2025 counts at least 16 of these communities filing for Chapter 11 since March 2020, affecting more than a thousand families and erasing roughly 190 million dollars in entrance fees. At one New York community a resident who paid 945,000 dollars under a 75 percent refundable contract expects to recover less than a third of the roughly 710,000 owed. *An entrance fee is described to buyers as a deposit and behaves in a bankruptcy like a loan to the operator, repayable after everyone with a security interest has been paid.* Three questions settle most of it before signing. Whether the refund is payable on a date or on re-occupancy, and if the latter, what the average wait has been there. Whether the state requires an actuarial study, since only three do. And what portion of the fee the community will certify as allocable to medical care, since the tax code allows a deduction for that portion based on a statement from the home resting on its own prior experience. ![](https://storage.ghost.io/c/5b/93/5b931ca3-34c1-4bd0-ba9d-9cc78907a475/content/images/2026/10/empty-apartment-with-keys-on-the-counter.jpg) *— John Stone*