WHY does your brother want to borrow ALL of your 93 year old Grandmother's money?!? He should be able to get a loan if he has a job. Is your brother disabled or unable to work, then he needs to apply for disability--NOT take ALL of your Grandmother's money!! She needs HER MONEY for HER HEALTH CARE NEEDS.
EDITED: Since your Grandmother is living at home, she will need ALL of her money for future HOME HEALTH Care or a nursing home? At age 93, a person's bones are very fragile and can break at any time thus resulting in hospitalization and need for rehabilitation and possible nursing home.
Does your Grandmother OWN her home or is she living with you or someone else? Is your Grandmother and/or Brother thinking that by having your Brother BORROWING ALL of your Grandmother's money, that she will qualify for Medicaid sooner? There is more to think about than qualifying for Medicaid, before your Grandmother loans any money to anyone.
He is needing to buy a semi to start driving over the road so he needs it as a down payment. Her health is not good and I know and she knows he would never be able to pay it all back before she passes. She lives at home for now but she is close to needing to go into a nursing home. I do also have her in In Home Hospice.
This sounds like a bad idea for so many reasons that I don't know where to begin.
Your grandmother lends money. The loan is subject to a formal repayment arrangement, and the repayments (plus interest?) would then be income. I am purely guessing and others will know better, but if the loan were a loan and not a gift then I suppose that Medicaid might accept that situation. Possibly. Why not ask them?
But. If a grown man doesn't have the credit history or the moral compass to come up with any better solution to his financial needs than to borrow his grandmother's entire savings, it does not inspire confidence that he will repay a cent of it. What then?
By the way, though. I know that where I live, a debt becomes payable in full when the creditor dies. So here, in the UK, if your grandma lent me $30K, and by August I had repaid $4K, and she were to pass away, I would immediately owe her estate $26K. You'd better check what the law says about this point in your state. Does your grandmother have a will?
If everybody in the family is in agreement that your grandmother knows what she's doing and that your brother is acting in good faith, there's no need for us to narrow our eyes at him and get all suspicious. But I'm sure you can see what this looks like. Who is responsible for managing your grandmother's finances, has she given POA to anyone?
Oh Honey, I understand the need for money for a down payment for a semi. I had a friend whose son borrowed money from his Father for a semi but the son "lost" the semi when his father had a heart attack and needed the son to return the semi to the dealership so that the father could have money for his medical bills.
You wrote: "she is close to needing to go into a nursing home. I do also have her in In Home Hospice." How does she (and you) plan for her to pay for the nursing home? Are you trying to "spend down" her money in order for her to qualify for Medicaid by having your Brother get a loan from her?
I agree with CM, call the local Medicaid and ask them if loaning someone all of their money is considered as "gifting" or does the person need to repay the loan with the repayment considered as "income" for the grandmother?
Does your brother and grandmother plan to have a loan document with a payment plan in writing so that she and you and your brother have "proof' of where her money went to? Who is your grandmother's POA and Medical POA and Executor of her Will? Have you talked to your grandmother's attorney about this situation?
She won’t be eligible for Medicaid if she loans out $30k and needs Medicaid in the next 5 years. Even with a contract. Medicaid is not for those who loan tens of thousands of dollars.
I would not loan brother the money. It sounds like you and Gma are not really comfortable with it. Go with your gut feeling. This business may never get off the ground. Tell him sorry, its all Gma has and she may need it for her care. Tell him if she ever needs Msdicaid, it may effect being able to receive it. Never loan what you can't afford to.
EDITED: Since your Grandmother is living at home, she will need ALL of her money for future HOME HEALTH Care or a nursing home? At age 93, a person's bones are very fragile and can break at any time thus resulting in hospitalization and need for rehabilitation and possible nursing home.
Does your Grandmother OWN her home or is she living with you or someone else? Is your Grandmother and/or Brother thinking that by having your Brother BORROWING ALL of your Grandmother's money, that she will qualify for Medicaid sooner? There is more to think about than qualifying for Medicaid, before your Grandmother loans any money to anyone.
Your grandmother lends money. The loan is subject to a formal repayment arrangement, and the repayments (plus interest?) would then be income. I am purely guessing and others will know better, but if the loan were a loan and not a gift then I suppose that Medicaid might accept that situation. Possibly. Why not ask them?
But. If a grown man doesn't have the credit history or the moral compass to come up with any better solution to his financial needs than to borrow his grandmother's entire savings, it does not inspire confidence that he will repay a cent of it. What then?
Call Medicaid and ask them.
By the way, though. I know that where I live, a debt becomes payable in full when the creditor dies. So here, in the UK, if your grandma lent me $30K, and by August I had repaid $4K, and she were to pass away, I would immediately owe her estate $26K. You'd better check what the law says about this point in your state. Does your grandmother have a will?
If everybody in the family is in agreement that your grandmother knows what she's doing and that your brother is acting in good faith, there's no need for us to narrow our eyes at him and get all suspicious. But I'm sure you can see what this looks like. Who is responsible for managing your grandmother's finances, has she given POA to anyone?
I understand the need for money for a down payment for a semi. I had a friend whose son borrowed money from his Father for a semi but the son "lost" the semi when his father had a heart attack and needed the son to return the semi to the dealership so that the father could have money for his medical bills.
You wrote: "she is close to needing to go into a nursing home. I do also have her in In Home Hospice." How does she (and you) plan for her to pay for the nursing home? Are you trying to "spend down" her money in order for her to qualify for Medicaid by having your Brother get a loan from her?
Does your brother and grandmother plan to have a loan document with a payment plan in writing so that she and you and your brother have "proof' of where her money went to? Who is your grandmother's POA and Medical POA and Executor of her Will? Have you talked to your grandmother's attorney about this situation?
How long has Grandma been in the loan business?
She will require the money for her care and has NO way to earn that money after retirement, vs. Brother can earn money.
Our elders nest eggs are for their use only, try not to allow her to be exploited.