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Can a creditor make a claim against parent's house if it has been signed over to adult child?

Asked by mariemac  |  Nov 9, 2011

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My mother signed her house over to me 6 years ago. She now needs to go to a nursing home. However, she has credit card bills that she will be unable to pay. All she has is her social security check and that money will go to the nursing home. Can the credit card company put a claim against the house, even though my mother's name is no longer on the deed?

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Carol Bradley Bursack, Nov 10, 2011

Over the span of two decades author, columnist and speaker Carol Bradley Bursack cared for a neighbor and six elderly family members. Because of this experience, Bradley Bursack created a portable support group, the book "Minding Our Elders: Caregivers Share Their Personal Stories."

 

Since she signed it over to you six years ago, I'm not sure. I wouldn't think so, but you should check with an attorney about that. Medicaid goes back five years, so you should be okay with them. I don't see how creditors could do that, as you've been the owner of the house for a significant amount of time. But I'm not an attorney, and creditors will do anything they can get away with to get their money. If they try to take it from you, you should get a legal opinion.
Carol

 
 

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Ralph Robbins, Nov 10, 2011

Ralph S. Robbins, CFP© is a fully licensed Certified Financial Planning Practitioner specializing in Eldercare Financial Planning. He works everyday helping families in crisis find creative ways to fund long-term care expenses and deal with family financial issues.

 

Only if they file for a judgment and they will then have to prove that a "fraudulent conveyance" took place. It will never happen.

 
 

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JaneB

Give a Hug

Nov 10, 2011

The credit card companies cannot make a claim against the house. They will guilt trip you and threaten legal action. But you are under no obligation to pay the bills for your mother, either.

 
 

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igloo572

Give a Hug

Nov 10, 2011

Most credit card creditors are relentless and go after anyone who seems to have a relation with the debtor even if there is no legal reason for them to pay the debt.

If your mom properly transferred the house 6 years ago so that it is legally titled in your name; & is recorded as such at the tax assessors or whatever govt. entity does that for where the house is, then you should be OK and the house is out of the reach of creditors as your mom doesn't own it/it is not an asset. You are not responsible for her debts. Most tax assessors have this information on-line, so try checking to make sure it was done OR look at your tax bill. Alot of counties send it out about now (fall/early winter) so that it can be reviewed & paid for Jan, 2012

Some states, like TX, have their laws such that credit card co. or whomever they sell the debt to cannot put a claim or lien on a homesteaded property to begin with.
You may want to look to see what your state's law is.

If you find the name hasn't changed and your have the paperwork to establish that it should have been, you'll have to go to the assessor's office and walk it through for the change. Be super nice & sweet & kinda dimwitted(LOL) & go early. If she had an over 65 exemption and you don't qualify for it you will need to pay the difference on-the-spot for those years to get the paperwork done in 1 trip. Some assessor's office will only change so that you get the scannned/filed/recorded
paperwork, which can be called an instrument/conveyance/deed of trust, IF ALL is paid in full and current - which mean you pay whatever IN CASH right there and then or via a credit card (which usually has a % surcharge). Checks can take days/weeks to clear and the paperwork will take longer because of that. This can take up to 90 days to get back and you probably don't want that.

It's good to have the paperwork together anyways so you have it if mom ever needs to apply for Medicaid. Your good there are the review period is 5 years.

 
 

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