Mom owes property taxes she can't pay, facing foreclosure. Now what? - AgingCare.com

Mom owes property taxes she can't pay, facing foreclosure. Now what?

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My Mother has always kept me at arms length, I'm the only child. This year she was hospitalized twice for pneumonia, had a long stint in rehab. I found her house deplorable, took family leave to clean it all up and in digging around to find what bills needed paying I discovered what financial disaster she was in. Because she was confused in the rehab I was able to get POA so I could pay bills, She took out a reverse mortgage over ten years ago and has exhausted all of that, ( over $260,000) with nothing I can see to show for it. She has maxed a credit card for $6000. and I cant find anything to show for that one either. I plan to create an online account for that one just to see where it was spent. I Took family leave for five weeks to get her house straight so she could go back there after rehab. She didn't want to sell the house and in investigating any type of supportive housing in our area, there is a two year waiting list! I live 25 miles away and work full time. There are no other family or friends to support her. I applied for Medicaid for her since her monthly income is under $1000., still waiting. She had rehab at home for a few weeks and I also hired a private person to come in to do cleaning and shopping once a week. Last week I found a letter among her newly arrived mail regarding her back property taxes. She has not paid her taxes in three years and now owes the town over $17K dollars. I called the tax office and was told she signed an agreement with them last year to pay $500 a month to catch up and she violated the agreement! This woman is in total denial and wont agree to anything yet, just keeps telling me to 'wait and see". I'm angry that she has created this mess and I'm left to try to straighten this out. There is no way to pay these taxes back and pay her living expenses. I feel we should sell the house now while its summer (better market) instead of waiting for the town to foreclose. I guess I will have to get her an apartment somewhere but she really needs some kind of supportive housing with someone looking in on her. There are waiting lists everywhere. Mom just turned 87. I guess we just get an apartment and pay for it out of whatever is left from the sale of the house till its gone and then what? Selling the house will make her ineligible for Medicaid if there is money remaining. I'm so frustrated.

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DayTripper: Thanks so much for the update! Your mother has put you in a quandary! Not only do you have to come up with $4,800 in one year's time for her current taxes, but you have to come up with the funds for the "in arrears" payment plan! Totally UNACCEPTABLE! DO NOT USE YOUR OWN FUNDS FOR ANYTHING, ANYTHING! Many a reliable source told me this. Yes, I understand that "you're placing a letter with your attorney," however, YOU MAY NOT SEE A DIME OF THOSE FUNDS! I am so sorry to hear of your broken tibia. Mother screaming at you, then handing the phone over to housekeeper=demoralizing! Be mindful that since "you're putting her on every waiting list you can find," that she can take herself off the list when her name comes to the top. My mother did, then made it very difficult because I had to leave my life and move 400 miles away to live with her!!!! Then on top of your kind-hearted spirit, your mother is rancorous.
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Daytripper, thank you for the update. I understand the "just don't care anymore" feeling because our elders are stuck in their ways, refuse to leave a house that isn't elder friendly, and in my case my parents didn't want outside caregivers or cleaning people to come in. Plus our parent(s) generation have vision of an old musty noisy uncaring nursing home, not realizing there are really nice Assisted Living that look and feel like hotels.

When my Mom [98] passed, it was much easier for Dad [94] to allow into the house caregivers, and for him to eventually say he wanted to move as the house was too much for him to deal with. He's really happy in Memory Care. I also had to take over the finances for my Dad as he was throwing out bills thinking they were junk mail... it was my Mom who handled the checkbook and the bill paying.

When it came time to sell my Dad's house, I hired a licensed Appraiser and he knew the house was going to be sold "as is", thus a Buyer could not ask Dad to fix anything. The house sold very close to the appraised value, and the Buyer is busy remodeling.
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Update Re: tax situation with Moms house. I spoke with the Town and they were happy to negotiate a small payment plan for her back taxes. HOWEVER!
I would also have to commit ( as POA) to paying another 1200. quarterly for the CURRENT taxes, which she simply does not have. Since my first post, I fell and broke my tibia which requires I be on crutches now for 6-8 weeks. I had to call Mom, (cant drive yet) to inquire if she had necessities, etc, anything she needed. When I broached the subject of the house and to think about where she wants to relocate she screamed that I'm trying to "scare her" and handed the phone off to the housekeeper. Right now I'm out of work and cant drive so I'm making use of the time this way: putting her on every waiting list I can find. She will need to be out of the house before a realtor can show it so it may no t be until spring. If the town forecloses before then, then they can place her somewhere, I just don't care anymore. I'm tired of being mired in all this red tape sh** for someone who wont cooperate at all. I don't imagine theyre allowed to dump an 87 year old out on the curb. I will try to find her a safe living situation with some type of supervision. They all require a deposit, if I have to use my own funds for the initial move then I'm placing a letter with an attorney that I recoup those funds when the house is sold. Period. Lost enough sleep over this situation for someone who only abuses me and takes no responsibility for the mess she has create3d. Dementia is definitely getting worse and she would be safer with supervision, tho porbably not happy, but then again she wont be happy anywhere. Thanks all for your support and feedback. Well appreciated!
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See if CC Company will work with you to lower the amt due....or else set up a payment plan.This is not uncommon. The elder who thinks they can run a household and are too stubborn to say they can't AT ALL. My late mother was liked that...lived 400 miles from me....it forced me to uproot my life and move there 400 miles away! I don't think your mom is capable AT ALL OF RETURNING home! Try a debt reduction program. I knew a woman who spent $85K on clothing because she was OCD and they worked with her. The "wait and see" story that your mom is telling you is a waste of time and money. The best thing to do is to see how the Medicaid app is coming along so that you can sell the house and she can move into an NH. She has been very untruthful with you. I would be as mad as a hornet!
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Daytripper, Hope your Mother is better after having been in the hospital. It is perfectly understandable this could happen-as she held you at arms length-for a reason. No guilt, be at peace about that.
Your mother may have a different understanding of the reverse mortgage than you. She may not realize her obligation for taxes.
I found this:

A reverse mortgage or home equity conversion mortgage (HECM) is a type of home loan for older homeowners (62 years or older) that requires no monthly mortgage payments. Borrowers are still responsible for property taxes and homeowner's insurance.
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Did you come across any correspondence from the mortgage company regarding the taxes because not paying the taxes breaches the terms of the loan. I know that they are required to work with her but I think it's only for a year which has been exhausted. I would Google the company and the policy regarding the taxes because it's entirely possible that they can demand immediate repayment of the loan or take the house since she's been in default for 3 years.
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Babalou, thanks for your information on your experience with flippers as well.
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just to chime in on Igloo's thoughts. We started cleaning out my parent's 1956 Cape Cod in 2013 when mom had a stroke. Fast forward 3 years...after more cleaning, 1-800-Junk and major "getting stuff out of the garage" (OMG, so much illegal pesticides, etc", we allowed asked realtor friend and neighbor sell to a flip company (mom netted 290,000). House is now on the market for $510,000, has new bathrooms, one less door to the outside, etc.
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DayTripper - I'd be cautious about using the Realtor market analysis. These are based on comps (comparables) of properties in the same zipcode or area that are similar sq footage and general description that sold recently. If Moms place is pretty well run down, unrenovated, not up to current codes for newer construction, if the majors (roof, AC, heat) have not been replaced within the past 10 years, etc....well the comps could be way way off to your moms place. Buyers now expect a certain level of home - like granite countertops, rainfall shower heads - if they are going to pay top $ unless moms house is in a real estate market with little to no inventory. H & G TV effect.

Realtor did a book for you?if so, Look at the comps and drive around to see the actual comps sold & also look at a couple of similars currently on market. Are they like moms? The ones currently on market are they empty & staged for buyers? Freshly painted interiors and yard looking all green, trimmed & happy?
Just how do they compare to moms? Be critical & realistic.

Trying to sell old folks homes with elderly still living in them, with old people's furnishing, kicknacks & "odor" isn't easy. Mom & her pets will need to leave whenever there's a showing ideally. Is this at all feasible? and feasible for a month or two...?

As one who has dealt with parents pre WW2era unrenovated home, there could be stuff lurking that makes it very difficult to ever sell at comps value. If there are foundation problems an inspector will find & include it in their report which will go to the underwriter for the mortgage company for the buyer. FHA & VA usually will not do any underwriting on houses with foundations significant issues and they are about 80/90% of buyers. Once an inspection is done, all the deficiencies found by an inspection have to be disclosed from that point forward. If significant it's going to be cash sale likely to a investor (6 week flip type) who will pay land value plus 20-30%. So 100k house maybe pay 40-50k.

Before you get too much deeper on house time, energy & costs, think if there could be major deficiencies that will come up in an inspection. You could even proactively get an inspection & appraisal done but that may just be throwing $ away. If the RM lender did not even do an inspection prior to the lending, there could be issues. If so, it may not even sell for enough to clear the RM payoff. If that's what is looking likely, cut the losses & walk.
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Daytripper; GA and Igloo have LOTS more info on this subject than I do...yes, Ward of the State, not guardianship was what I was thinking. Let us know how this is working out. We care!
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