Any suggestions on buying a house together with elderly parents?

Follow
Share

My mother and father can no longer live on their own, they sold their house and joined us in a house we are currently renting to determine next steps... Traditional Assisted Living will kill them and my husband/I cannot afford to buy the rental house on our own. The logical step to purchase the house jointly...any suggestions? Please help!

This question has been closed for answers. Ask a New Question.
15

Answers

Show:
On the contrary, purchasing a home with parent(s) can be a very good Medicaid asset protection technique. I had one woman purchase a home with her daughter. As long as they each contribute half of the purchase price, there will be no gifting and the Mom's interest in the house will be exempt when she applies for Medicaid eventually.

I also made sure the deed was in joint names with right of survivorship (JTWROS). This was important, so that upon Mom's death, the house passed automatically 100% to the daughter's name, avoiding both probate and the state's claim for Medicaid paid out for the mother's care.

If it gets to the point where your Mom needs care in order to avoid going to the nursing home, there is a federal law that says that if you take care of your parent for at least two years immediately before they go into a nursing home, and your care enabled your parent to delay needing nursing home care, they can transfer their house to you (or their interest in the jointly owned house, as the case may be) without any gift penalty.

Finally, consider a personal services contract, where you care for the parent in exchange for payment. Again, this avoids gift treatment of the money coming to you, though of course it is taxable income to you.
Helpful Answer (0)
Report

How long have your parents been living with you? How is it working out?

How old are your parents? What are their impairments that prevent them from living on their own? How much care do they need?

What is their financial status? If they just sold their house I imagine they have at least that money in savings. Do they receive a monthly income?

Having these answers would be helpful in figuring out how to answer you.

What if your parents paid a reasonable amount for rent and food, etc. and you put it away until you had enough for a downpayment to buy the house on your own? And then you continued to use that income to help with the mortgage payments?

If your parents are financially able to pay their own way, they should.

While it isn't what anybody wants, it really will not kill your parents to go to assisted living. Really. And it is wonderful at this point that they don't need to consider it, it is possible that some where down the road one of them will need care that is beyond what can be provided in a private home, or that you will need to bring in in-home care for one or both of them. If they have their assets tied up in equity in your joint home, then what? What if they need to get their share of the equity out for their own needs? Where will that leave you?

I don't know. But it makes a difference if they are in their late 60s or early 90s, so I hope you will give us more information.
Helpful Answer (5)
Report

Be VERY cautious about buying a home with your parents. G. Heiser might be correct so far as medicaid is concerned however; dealing with elderly and dementia is an altogether overwhelming problem. Even with caregivers here at my home, I was unable to keep my husband here. Eventually he was too difficult for the caregivers to handle (and they were outstanding). We put him in an excellent nursing home. Giving hugs. Corinne
Helpful Answer (2)
Report

Do not buy a house together. If they ever need to apply for Medicaid this could cause a problem for them. You would be responsible if they needed Medicaid for coming up with what their half of the house would be valued at. This might be done as a penalty from Medicaid about what they would have to pay out of pocket before they qualified.(ex:$8000.00 would run about 60 days of non-payment to a nursing home if something happened to one of them and they needed this type of care)
Also do not let them buy the house and then put it only in your name, this would be
considered a gift by Medicaid that would have to be accounted for and they would
be penalized for it. Medicaid has a look back period. You never think that your parents might have to apply for Medicaid, but a stroke , a massive heart attack can
really do a number on finances, and if a parent is bad enough you might have no
other choice than to put them in a nursing home. You would probably need Medicaid to pay for this. Nursing homes generally cost $3600 and up per month.
Maybe a retirement community for them would be a choice.
Where I live there is one, and they pay a set monthly amount for an apartment and three meals a day, all utilities and cable, and a maid once a week. It is like an
apartment community, just with a little more.
The retirement communities are just like above. They retain their independence by having a private apartment, but the little
extra help like meals in a dining area(think like a cafeteria) maid, and transportation
to grocery stores, shopping, and doctors are sometimes the only extra help they really need.
Helpful Answer (1)
Report

I live in Texas, and had this problem with my parents. Although they didn't put any money into the house and I could prove it( I made all the payments, insurance, taxes, down payment etc), I still had to pay them their equity to qualify them for Medicaid and then refinance the house with their names off of it. Thank goodness, I had given them money to help them out every month and could prove it. Maybe it is different in other states. I live in Texas.
Helpful Answer (1)
Report

as jeannegibbs stated: if your parents ever need some type of surgery, nursing home care, assisted living, in home caregivers etc, they would need their share of the asset. As such you could be forced into selling the property. In my mom' case, it took 4 years for her property to sell! During the last 2 years I had to make all the association fee payments to the tune of $600 per mo; what a financial drain that was on me (due to something else that occurred). When the property did sell, I got my monies back thank goodness. Mom had a chunck of money but medicaid allowed her to pay for her funeral, periodontal work and some other allowable things so there was no money remaining to give to medicaid. Sure, I got my money back but i was out 30k+ for a long time. what if i was doing this for longer than 2 years...
although they might be 60 now, they are growing older and the likelihood of them needing their assets for some form of care is more likely than not; their assets should not be tied up with you because that will adversely effect you!

someone may tell you to buy the shared home but to use desginator such as tenants in commom or "joint tenants" or other real estate names, but it still comes down to you cannot sell 1/2 of a house...goggle this topic and good luck to you
Helpful Answer (1)
Report

I'm confused now. I thought the primary property was exempted from spend-down and only was in jeopardy when it comes to recovery unless there is special circumstance. There was a case recently where the mother appointed a POA that was not a co-owner of the house. The POA wanted to sell the mother's share of the property. Now, that was a problem.

I believe that K. Gabriel Heiser's answer is accurate. It sounds like a good plan if all parties get along. There does need to be careful consideration of future legalities, e.g. choosing POA or guardian. I also would worry about what would happen if there was a dispute and one member moved out of the house. Would you be able to purchase her share of the house if that happened?
Helpful Answer (1)
Report

My mom and I had a house together and I would never recommend it if there is even the remotest possibility there would be bad blood along the line. My mom is gone, she left a mess, there's bad blood between my sib and me...what a nightmare! I live in Texas too.
Helpful Answer (1)
Report

since there is confusion, you must seek the advice of an attorney to ensure things are done correctly. Therefore, what all of us have provided are all the questions that need to be addressed by the attorney before anything is signed.
Helpful Answer (1)
Report

I agree get an elder care attorney, maybe you won't end up with problems like I had.
I just know it ended up costing a bundle of money for me.
Helpful Answer (1)
Report

See All Answers
This question has been closed for answers. Ask a New Question.
Related
Questions