Follow
Share

Mom is in a personal care home. This is a college loan, she will graduate in May of 2014 and what if my mother in law lives another 5-10 years and the niece can't pay her loan back (which probably will happen). As a POA will I be responsible for that? My mother in law will be out of money within a couple of years, providing she lives that long. Should we try and get the loan stopped?

This question has been closed for answers. Ask a New Question.
Jeanne's right & sunflo has given you great insight too.

But the bigger problem will be later on when filly default's on her loan and grannie is sent collection letters as the co-signer on the loan. Gran's SS is pretty well untouchable from collection BUT if the bank account where her SS goes is co-mingled with other funds (like grannies other income or an annuity or savings) then the account is "exposed" to be seized for collection if the debt collector decides to be all hard-ball on collecting. If filly's school is one of those subpar "universities" that are totally for-profit motivated, they are especially ruthless in going after the co-signers. they don't give a rat's ass if she is in a AL or NH, dead or whatever. Now if it is a state-school those usually require some sort of acknowledgement form from the co-signer on the agreement that they understand their responsibility to be accountable on the whole debt if the student defaults.

Did gran get a copy of the agreement? If so, carefully read it. If not, you as her DPOA can contact the school in writing and request a copy of the agreement. They have to give this to you. I'd send the letter certified return mail from the USPO (about $ 8.00). You need to do all this so that later on if grannie has to apply for Medicaid, you don't want filly's loan amount to be viewed as gifting by Medicaid and grannie faces a transfer penalty on the amount.
Helpful Answer (2)
Report

Agree with jeannegibbs. You won't be responsible as POA. I would think if grandma can't pay her part of the loan, then granddaughter needs to understand she will still be responsible for that loan for example if grandma's care or med expenses escalate. If grandma dies before loan is paid off, then this will be considered debt that will have to be paid for by the estate. That leaves less for you and husband or other family members. Hopefully it wasn't a large loan that eats up most of the estate.
Helpful Answer (0)
Report

Since MIL is not incompetent, she could co-sign a lone without your approval. Her name is on the loan, not yours. I don't see that this could ever come back on you, personally.
Helpful Answer (0)
Report

Let's hope she pays it back!
Helpful Answer (0)
Report

Sorry, it's my mother in law, it didn't give me that choice. She is very alert and does not have dementia. I am simply her POA because she never took care of her finances before her husband died and wanted me and my husband to do it. She co-signed the loan. However, I have a bad feeling for this niece as she has been in school for five years and her career outlook isn't the greatest. MIL's assets will only last for a couple of years.
Helpful Answer (0)
Report

Worried, your profile says Mom is in a care center because of mobility problems. Here you are talking about your mother-in-law. Are these two different people you are caring for? Just want to be clear on what the impairments are of this person who signed the loan. Is she mentally impaired? For example, does she have dementia or some other cognitive condition?

When you say that she "signed the loan" do you mean she acted as a co-signer for the loan? Or did she loan money out of her own account?

What is the source of MIL's income? Is it only Social Security or include other sources? Is she spending down some assets that will last about another couple of years?

A little more information will help clarify things. But in general, no, being POA does not make you responsible for MIL's debts.
Helpful Answer (0)
Report

I am not a lawyer but with a little common sense and moral compass, if mom has a POA, it is in preparation for, or because she is incompetent.
If she is incompetent and it is known or obvious and niece still got her to give her a loan it is elderly abuse. Kind of like stealing candy from a baby, except the baby may need that last piece of candy to live out her life.
If niece is using this for college, it may be a bad spend of money as her career prospects may be ruined by a record for fraud and elderly abuse.

As POA of an incompetent person you have a duty to interfere from her assets being taken and as you stated unlikely to be repaid, prior to being needed,

I do not mean to be harsh, but taking the few last assets from the elderly is just shameful.
Helpful Answer (0)
Report

This question has been closed for answers. Ask a New Question.
Subscribe to
Our Newsletter