I am the daughter with no help with my father who suffers with dementia. He had a stroke and is unable to care for himself now and resides for now in a nursing home. I do not know who to turn too. He wants to return home but he would need caregivers and probably a lift. He has no extra income except his SSI. He used his funds from reverse mortgage years ago. I was told he could restructure and get more from house now. I do not like the nursing home for him but I'm so confused what to do? Money is so tight..I have been floating his home with anticipation I can bring him home, but now do not think it's a good idea. Have a big bill from nursing home, even though waiting for his approval from Medicaid. Even so, he will still owe quite a bit of money. He owes money everywhere with his medical care, still the hospital, the people that have had to transport him to specialist, and just the bills on his home. His property value has increased but not sure what this could mean to help him financially. Has anyone else been in this situation and how did you handle? Who is helpful to help me sort this out? I am stressed, confused and feeling ever so frustrated.
But the RM lender is & does. RMs due to interest &fees tend to produce no proceeds or profits from the sale unless the property has in a huge, HUGE increased in value. To me, I’d suggest you determine what the financial situation is on the house as your main priority. Dads in a facility currently so he’s being taken care of.
RM have “call in loan” ability where mortgage repayment is due in full usually in 60 days if the homeowner is out of compliance with RM terms. Most have terms such that if the homeowner is away for a year the loan becomes due. But also tend to have terms if they change their residence, loan becomes due. Dads applied for Medicaid as he’s a now a LTC resident in the NH, so if RM finds out the loan can be called in. So you kinda have to be careful in contacting the RM as to not to start this before you have a plan.
You need to find the RM paperwork that dad has to see what the amount will be. It sounds like he got the $$ as a lump sum, which is the most expensive RM (as opposed to a line of credit RM). The paperwork should have the interest table so you can do a rough calculation of what’s owed. Then find the most current tax assessor bill within bill the value of the property is shown. So is house value under the RM+interest figure or over???
If over, is it by more than 15 - 20%? (15-20% would probably cover all the fees to close out the RM)??
If property value is under RM+interest figure, I’d cut my losses, not spend a penny of your $ anymore, take everything out of the house dad could use in the Nh (store stuff for him at your home if need be) or stuff of sentimental value for family and let RM figure it out. Medicaid doesn’t care if dad has debts or has foreclosure. Medicaid only concerned on his income & assets
If it’s over 20%, the $ from the sale will be income to dad the month it gets sold & then an asset afterwards. And either way, it will more than likely make dad ineligible for Medicaid as he’s over Medicaid limits. Dad will have to do a spend down to get back down to impoverishment level to be eligible for Medicaid. Also if it gets sold, as it’s dads house, the $ from sale must all be dads. Dad cannot easily repay you for any property costs you paid cause Medicaid tends looks upon that as gifting by dad to you. Medicaid seems to look at things children pay for as done out of a sense of family duty unless there’s a promissory note done in advance. Gifting places a penalty on dads Medicaid application so he’s ineligible till cleared. Trying to get around this would need imo a elder law atty to shepherd dads application. Upside is that dad can use house sale $ to pay for atty. Again dad cannot gift to you.
I’m not a fan of walking on debts. But if just a low profit from house sale but will cost you $ to pay for taxes, insurance, getting house market ready, etc. it may not be worth trying to sell house but instead dad turns it over to the RM lender.
It sounds like dad is “Medicaid Pending”, if so, has the NH spoken with you or dad about the copay or SOC (share of cost) of dads monthly income requirement by Medicaid? Copay means dads monthly income (like his SS) must be paid to the NH less a small personal needs allowance (average $70 mo). So you or family will need to pay whatever costs arise on property unless Dad gets a diversion of the copay.
It’s a lot of things to think about even without worry on dads health. Like Freqflyer said, it’s good that Dad has applied for Medicaid. For my mom the application process took about 5 1/2 months but once eligible was retroactive to the first of the month my mom moved into the NH. The vendors will have to rebill to Medicaid once dad has his Medicaid #. Do not pay any of the bills cause once paid well they aren’t required to rebill to Medicaid.
Try not to get too overwhelmed. Take time for yourself.
Glad to read that you have already applied for Dad to receive Medicaid. When it is "Medicaid Pending", once totally approved, usually Medicaid will pay the back payments. You would need to check on that.
You might want to see an Elder Law Attorney who can advise you on what to do with the house. It would seem best to sell it now, and pay back on the Reversible Mortgage loan. Thus, if the property had increased in value, chances are all the "interest" and "fee" will use up some of that equity. Any equity left needs to go to the nursing home for Dad's care. I know this is soooo complex. The Elder Law Attorney might have other ideas, depending on State laws.
If you don't sell the house, then someone would need to come up with mortgage payments, if there are still outstanding payments.... pay on the homeowners insurance... pay the real estate taxes... pay the utilities... have the lawn mowed and the snow shoveled. The homeowners insurance will go up if the house is empty as now the house is considered a risk.
Oh why does getting older have to be so complicated :(