My mom is in a nursing home and on Medicaid in Michigan can she sell her home for what she owes on it? - AgingCare.com

My mom is in a nursing home and on Medicaid in Michigan can she sell her home for what she owes on it?

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A guy has offered to buy the house, as is, due to it needing to be remolded and there is foundation problems. I cannot afford her house and mine? She owes around 70,000 and just wants to sell it to pay off the mortgage. Market value is 189,000. If she makes a profit can I buy her a non fundable funeral plan. Will she lose her Medicaid. Or should I let the bank forclose on it. Do I need to call her Medicaid worker also? So confused. I have no money for a lawyer because I'm taking care of my husband with cancer.

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Deniselex, if only you and your Mom could have used some of the equity in the house to pay an Elder Law Attorney, who would have guided you on the best route to take.

Sounds like all the options are off the table since there isn't any money to keep an empty house up and running. Hopefully Mom has a special insurance policy just for vacant houses, as such houses are high risk.

I am not an attorney nor have enough knowledge about Medicaid and house liens. With foreclosure looming, time to talk with the mortgage company, let them know that Medicaid is involved.... chances are Medicaid could already have a lien on the property.

You need to ask the bank if your Mom can get the remainder of the equity after the $70k loan is paid off after the house sells, or will Medicaid take all the remaining equity to help pay for your Mom's care. I know, this is such a maze. And emotionally and physically you rather wish it would all go away.
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I would love to use a realtor but I'm unable to make the monthly payment on the house and keep the utilities going until it sells. I don't have the money for a lawyer as all my money is spent on taking care of my husband who has 4 th stage cancer. Definitely a big headache.
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I think I'd also get the opinion of a soil engineer or other foundation engineer to get an estimate on the cost of repairing a foundation. That could be big $$$$$$$, and more if there are any slopes from the foundation (if it's crumbling) or major leaks (if it's become permeable and there is any water penetration).
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Deniselex, by chance was your Mom's house built within the past 10 years? Usually new home builders have a 10 year warranty, and depending on the warranty it could cover the cost of the foundation.

Veronica, that is a good question, who stands in line first for payment, the mortgage company or Medicaid. We'll have to wait for Igloo to see this post as I bet Igloo would know the answer :)
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Definitely call the Medicaid worker. I believe any money you spend on pre paying for a funeral is allowed. FF has covered everything else. Nothing wrong with selling it as is where is as long as you have a good appraisal to show Medicaid. Perhaps FF knows whether the mortgage is first in line or Medicaid has first dibs. There will be a lot of expenses associated with the sale which will be deducted from the selling price. Don't agree to a low price before you get the facts. Get free estimates for the work you know needs doing like the foundation before agreeing to a price with this buyer. Just be very careful under these circumstances.
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Deniselex, if the market value is $189k, minus the $70k mortgage owed, why give away $119k since your Mom wants to sell the house for what she owes on the house? That's throwing money away big time.

Medicaid might consider that a really big gift to the Buyer. Consult an Elder Law Attorney now to help Mom get through the crazy maze of Medicaid and ask about selling the house. If the Attorney is ok on waiting for the house to sell before getting paid, go for it.

I sold my Dad's house, which was also out-of-date, but first I hired a licensed appraiser to give me the market value. Thus if I had ever needed to prove why the house sold for less then other houses in the neighborhood during the same span, I had proof on paper.

Mom won't lose her Medicaid if she profits lets say $100k after paying off the mortgage, the Realtor fees, the house sale settlement fees. What will happen is that Medicaid will wait until Mom uses up that money before Medicaid kicks in. Note to self, the profit money needs to be spent on Mom's care only.
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