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Mom broke her hip 2 years ago, and I relocated her to Georgia. She won’t walk and needs help with all activities of daily living. I moved her into a very nice senior community with assisted living, but her monthly long-term care expenses ($8,500) for the last two years have zapped her savings and mine. I shouldn’t have to go broke providing care for her and feeling resentment.
Her home in Mississippi is paid off and on the market. Unfortunately, it’s in a small impoverished town. We need money now. I have financial power of attorney. Can I get a reverse mortgage to pay for her expenses until the house sells?

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I just sold my mothers house. Not a great area. Faces a very busy street. Bad roof. Bad plumbing. A mess! I called a *We buy ugly houses* company. They came out looked around and made me am offer. Typically their offer is 25% below market. I was very happy with the amount. They pay cash and there are no inspections which this house would never pass!
They also said anything I didn't want or could not move they would dispose of. This was huge because I couldn't possibly clear out the house. They offered to close in 2 weeks. I asked for 30 days.
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Sendhelp Nov 18, 2020
Congrats!
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Have you or the listing RE agent looked at who is actually on the deed now?

Contact the County Recorder's Office.
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Keep - on the possibility of a HELOC I can not see a bank doing one on a vacant home. Maybe if it’s a second home in the same state, like since it’s in MS that if mom say lives in Bay St Louis but has her old family homestead up in Lumberton, maybe a bank like Regions or Hancock would do a HELOC. But they’d still run a credit check & order an appraisal done. & if she has outstanding debt, may want that paid down with HELOC $ first & foremost. If moms really old she may be aged out of doing a loan as she’s outside of actuarial tables for risk.
I think her now being out of state kills any opportunity for a HELOC unless house is like in Corinth or Oxford area and she’s right across state line in TN.

I do feel for you in the getting taken by family. You may want to look to see if perhaps mom too was taken by family in 5 years or so before she moved up to TN. In case the atty didn’t mention it, pls realize, TN LTC Medicaid will want a lookback of 5 years on moms financials. If mom loaned $ to another worthless neice or nephew Medicaid will look at is as “gifting” of an asset of moms to them. Medicaid can place a penalty on stuff like this. Really before you send them Christmas wishes, look into her bank statements from 2016 to now. You don’t need any more family surprises...... bless their hearts!

& again pls check to see if shes current on MS property taxes. & if not if it’s more than 3 years. MS has 3 yr redemption & it’s easy peasy to get a tax sale deed in MS. The rub in this is that there’s tends to be a lag time before deed gets recorded so the delinquent property owner will get a bill for years and pays tax Bill even tho someone holds a tax sale lien. I’m in New Orleans area (headquarters of the Hurricane of the Month Club for 2020) and loads of folks have weekend places on MS coast or up Starkvegas / Oxford and it’s amazing how many have had subterranean tax sale lien & deed issues.

Also clearly find out if TN LTC Medicaid will pay (it will be a waiver program) for AL & if so, how feasible it is for her to get into a Waiver paid Medicaid bed in an AL.
Or
if it’s ONLY that TN Medicaid pays if she’s in skilled nursing care facility aka a NH. If it’s only SNF, ask if where she is now has a sister NH facility that she could transition onto and into a Medicaid LTC bed. If that is a total no, I’d try to move her into a place that is this. Most states do not do AL waivers; some do but it’s extremely limited to be useful so in actuality useless for family (this is what I found for my mom in TX); and yet some states have waivers for MC but not AL. That atty you saw should if they are at all Medicaid savvy know the nuances for TN Medicaid. Not just about doing a spend down & filling out the LTC Medicaid application but knowing what’s out there & availability.
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igloo572 Nov 20, 2020
My bad, ignore the TN geographic references. Substitute GA

also I cannot emphasize enough getting appraisal on the house. Not Realtor comps but regular appraisal, like with signature, seal, license #. Should it sell below FMV, it will give you documentation to shut down any GA Medicaid concerns. Unless the house is a lil old gold mine and sells for over 300/350k, the probability is that mom will outlive her $ and you end up applying for LTC Medicaid for her and face a 5 yr lookback. $8500 mo for AL is pretty expensive, if that’s the basic AL rate for your area what’s NH? 12k? 15k? more??? You need to be proactively planning for Medicaid when feasible. Best of luck selling the place!
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Can you rent the house?
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Keepurheadup Nov 19, 2020
I’d rather not. I am overwhelmed trying to manage mom’s care in Atlanta.I want that house off my plate.
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I’m going to assume mom will @ $8500 a mo run out of $ & will need to eventually file for GA LTC Medicaid, my answer is based on this:
- as others have posted RM not an option as property is not “owner occupied”
- it’s been in the market for a while, right? Well either it’s basically unsellable for a normal Realtor type of sell OR it’s priced way way off. Do you know which scenario it is?
- Did u get house appraised? If not, I’d do that & it’s moms $ that pays for this and other stuff house. Like done by registered in state of MS appraiser. Not a “sell value” document done by a Realtor. To me the issue with getting something from a Realtor is that they tend to go with the most optimistic value & based on sold comparable which are likely to be newer home or renovated older. If your moms home is old with decades of delayed maintenance & not recently renovated, it will never ever sell for Realtor value. The appraisers ime tend to do a more “conservative value” based on all the problems that that piece of property has blended with true comparables even if its beyond normal neighborhood boundaries for comps.
- appraisal is mucho importante for that Medicaid eventuality. Why? Well Medicaid will want that property sold at FMV= Fair Market Value. But appraisal can be used for its truer & more precise value. There could be a wide gulf of difference from it’s supposed fmv $$$ and true value $. What you don’t want to happen is for GA Medicaid to disallow the sale of her MS home as it sold for $56,789k but MS tax assessor has it at $123,456. The appraisal helps to get around this type of concern.
- she is going to have to sell the MS home OR show beyond any doubt that it’s an inaccessible asset to GA Medicaid. A home, land or property in another state is a nonexempt asset. Medicaid is going to expect non-assets to be sold & cashed in with $ used as a spend down till mom finally gets to the 2k in nonassets allowed for individual LTC Medicaid applications. Some states Medicaid will automatically have her ineligible till her nonexempt assets are gone. Others will allow it to continue to be her asset but has to be Realtor listed and sold within a period of time and if not Medicaid gets suspended, or she has to renew a waiver to have it as nonexempt asset.
- sometimes, but seems rare, they can have an inaccessible asset. It’s something that they have ownership of, but realistically cannot ever be sold with a cash value to them. There was someone on this forum whose parents had a piece of land locked acreage that was generationally inherited.... it really could not be sold as no access to it... unless one of the adjacent property owners wanted to buy it they would never ever find a buyer. If that MS house hasn’t had any offers in year or two of listings with price reductions, it may be an inaccessible asset. You might can use that appraisal to show why it is.
What reasons does Realtor give for no interest?

So you are paying for the house costs and moms AL?
Is that right?
Before this continues on into 2021 I’d suggest that you need to have mom & you meet with an elder law atty who knows GA Medicaid ASAP. The issue will be, imo, if you are perhaps thinking that once house is sold that you as moms Dpoa will repay yourself for all those costs paid, that will be a problem. It’s moms house, it’s all her $ from a sale. If she gives you any $ it can be looked at as “gifting”. And for Medicaid “gifting” can cause a transfer penalty on her Medicaid eligibility. A GA Medicaid savvy atty should have options to look at as to how to possible deal with this before it ever gets sold and if non-accessible asset is an option.

Got to ask, how are you dealing with keeping the house from being ransacked? Or having squatters?
Are property taxes paid? For MS this is important as MS has a 3 yr redemption cycle.
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Keepurheadup Nov 19, 2020
That was a lot of information, and I am grateful! I have an appointment with the eldercare lawyer who wrote mom’s will, POA and other financial documents shortly after relocating her here. I will be able to ask informed questions.
The house is saleable. I had a poor realtor initially. I allowed mom’s 70 year old sister-in-law to list the house last November. She lived 140 miles from the town where the house is located, was unorganized and was more interested in her brother getting the house for little of nothing. She obligated me to making a number of unnecessary repairs even though I said to sell “as is”! She was also acting as a “dual agent” without disclosing. Then the pandemic set in, and she was even worse. When I tried to terminate the business relationship in April, she said she had a buyer if I dropped the price $9000. She made a contract but never provided a qualifying letter for the alleged “buyer”. Contract dragged on for 2 months then fell apart. I had to wait until her “exclusive right to sell” expired August 30, 2020. In September, I listed the house with a reputable local agent/broker who is also an appraiser and a contractor. The house is located two houses from a local high school and a half mile from an elementary school. It’s in fairly good shape and has two extra lots.
With regard to squatters,I maintain a security system in the home, neighbors watch the property for mom, and I have a property manager ($100 monthly). It is still a source of angst. Mom initially wanted to rent the home to a relative, but that went south during a trial period. Consequently, the home is insured as a rental property which is high and another expense we can’t afford.
I believe the new realtor will get it sold...
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As answered by others, your mother should probavly look into applying for Medicaid. However, in many states Medicaid is not normally available for AL, monly for NH and MC. I can't tell with certainty which kind of living arrangement she currently is in.
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It sounds like it would have been beneficial for you and mom to have met with an elder attorney or financial planner when she broke her hip. You shouldn't be paying for her care unless you could easily and comfortably afford it. Mom's money pays for her care until it runs out, then she would transition to Medicaid. The attorney would have been able to prepare mom for the transition to Medicaid, and that preparation would have included dealing with the house. I don't think a reverse mortgage is doable or even practical if it were possible, I think you need to meet with an elder attorney who would know how best to get mom on LTC Medicaid.
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NYDaughterInLaw Nov 16, 2020
I agree completely, and only add that you should ask the attorney if you can recoup any of your savings that you put toward your mother's care from the proceeds of the sale of her house.
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Have you explored Medicaid? Once Mom outlives her income in less than a year we will apply for Medicaid on her behalf.
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Unfortunately you cannot use a Reverse Mortgage on this empty home, as mentioned earlier on this thread. So cross that idea off your list.

Check around with banks to see about an equity loan. If your Mom is able to read and understand loan paperwork, she might be able to do a loan from out of State, otherwise her Power of Attorney could need to be available to help out.

Cross off renting out of the house if someone suggests that idea. The rent wouldn't come close to the funds you need to pay the monthly fee at the assistant living.

One idea since the house is on the market For Sale, have the Realtor rewrite the listing as a handyman special if in fact it does need some updating. Rewriting it will draw in another group of buyers. I did that with my Dad's house instead of remodeling it which would have been overwhelming at my age [if I was 20 years younger I would have jumped at it]. Dad got a good price and the buyer was happy with his purchase.
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Frances73 Nov 8, 2020
We did that with Mom's home 2 years ago. It sold for $30k above the listing price!
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Isn’t it sad that health care is so costly? You are wise not to choose to go broke paying for your mom’s care.

I am not sure what your best option is. Are you saying that you can’t sell your mom’s home because she is in a declining area?

In general I don’t have good feelings about reverse mortgages. You could speak to an attorney and get advice regarding if it would be beneficial for you.

Best wishes to you and your mom.
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I think you need a "bridge loan".

Or, a real estate company that buys houses today.
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Isthisrealyreal Nov 16, 2020
No bridge lender would touch a situation like this. Too much potential for loss with an empty property.
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I would go with home equity loan. Interest rates are low on these loans right now.
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I've never heard of a reverse mortgage that allows borrowing on a non-owner-occupied property.

The fees are high and the cap on up front cash is low. Have a look at https://www.reversemortgage.org/about/reverse-mortgage-calculator/. I did a quick example of a home worth $130,000 with an owner aged 80. The fees displayed almost $7,000 and the up front cash available is 36,000 to 43,000.

I'd suggest looking into a home equity loan or dropping the price significantly to get a quicker sale.
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AlvaDeer Nov 7, 2020
Oh, right, Frebrowser, I forgot that little detail. Most reverse mortgages are for Seniors who wish to stay in their own home; when you leave your home the loan is due. At least in the ones I have heard of.
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If the home is not worth very much it is very unlikely that you will get enough income for her monthly to make much of a difference. I would strongly advise against spending your money, unless you are independently wealthy; what will happen when you have your own needs and there is no money. Reverse mortgages are a kind of a loan, and a fairly high interest over all. Others here are more financial wise that I, and I hope they will stop by with advice.
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