Mom lives in IL. Has had Medicaid since 91’ (after dad passed away). She only gets $700 a month. Has a reverse mortgage since 2002. Owes $150,000 to RM as of today. House may sell for a bit more, how much more, not sure. Mother is terminal but is refusing to go to assisted living and/or NF even though she is extremely weak on her feet & can’t use the bathroom in her house (she has a portable commode next to her bed). Has a companion/cleaning lady/caregiver come Mon-Fri, 4 hours a day. That’s what she’s allowed by Medicaid. House is in trust w/RM bank “1st in line” (they requested this in order to ok her acceptance). When mom passes away, I have to sell her house to pay back what’s owed to RM, if there is anything left from the sale, will Medicaid ask for that money from me or is the MERP only enforced when a person enters a nursing facility (which my mom is vehemently opposed to, she wants to “die at home”).
But the bigger issue will be what happens with the RM...... if she’s moved out of her home & into IL, you need to carefully read the RM contract as most have the RM become due within a set period of time after they move from home. RM requires one to be a homeowner actually living in the home. So find out what her terms are. If she’s out of compliance, the RM can be called in and like Yesterday.
I’d be surprised if there’s any $$ left after her RM is paid off. Between hefty interest, fees, whatever costs RM can tack on, most have no $$ left. Maybe just maybe if it’s a old old RM and huge property value surge..... But realize even if there’s $$, it will fall into increased income / assets for her so she’s now going to be over Medicaid’s limits. She’ll probably be ineligible to continue to stay of Medicaid so it’s private pay for care. Basically a spend down for her to become impoverished to apply for Medicaid again as she’s likely to be over Medicaid’s assets limits.
It’s going to be a hot mess of Paperwork to shift through in all this. Stay organized
The RM is secured lending, & secured debt MUST be paid off first.
Medicaid is unsecured and can have a lien placed against assets IF your state allows for this or becomes an after death claim on her estate.
I believe her house will sell for more then what’s owed but wasn’t sure if Medicaid would take any profit (after RM).
The RM guy said in order for their bank to approve the RM, they cannot be “second” to anyone claiming money on the house..
They will get paid first..
Oh and for anyone considering getting a RM.