Should I continue paying the mortgage if I am living in my grandmother's home while she is in a nursing home?

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The house is in her name. Me and my dad are continuing to live here. There is a mortgage on the property in her name. She was paying it but recently moved into a nursing home. Should we keep paying the mortgage?

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Igloo: I know that Gran pays her SS to the NH.
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The person applying for Medicaid-primary home does not get counted as the person's Medicaid assets.
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I agree about it getting complicated. On Medicaid, Granny is allowed to own under 2K in assets.
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KingConger, this could get complicated.
And it depends on the laws in your State.
And depends on whether G'ma is no longer able to sign legal papers.
My Mom lived in CA, and owned her house outright, before she married her last spouse. Therefore, it was _only_ her asset, not his. So when Medicaid looked for assets to cover his care, later, there were none of his to attach.
Since Mom herself was living on extra-low income, they didn't attach her assets, because that would have forced her to become a dependent on the State--which she'd avoided most of her life.
Mom's MIL had simply signed her own house and assets over to the State, to cover her facility care, which meant the State never came looking for her sons to repay State...not that either of them could have...but they would have tried.
State will only be able to get whatever Equity exists on that property.
IF there is insufficient equity, they might leave it alone, and it would simply default to her surviving heirs..._IF it's still mortgage-heavy_.
OR they will place a lien on it, and just wait for it to be sold or defaulted on. Liens are ranked in who gets paid first--lenders holding the mortgage get paid 1st; others stand in line. Probably State ranks second to the mortgage holder.
Also to consider:
Some states have a law like one in WA, which allows disabled family members _who have been living in the home_, to remain in the home, hopefully preventing those from becoming a welfare recipient.......of course, the heirs would have to keep paying the mortgage and bills...but that might be a better deal than moving and paying rent, if this can be arranged--in which case, you would want to keep those payments current!
IF you figure there's enough equity to pay the facility [but you have no idea how much the final bills will be], you could help arrange that.
Selling the house, or signing it over, would mean you and Dad move to a different house or apartment.
IF you are strapped and trapped, there is a potential that you could stop payments, yet continue to live in the house for a time---how long, is a gamble. Friends who did this a few years ago, lived in the house they were in for over 3 years, without paying any mortgage. They kept up utilities and insurance, just stopped paying the mortgage...knowing that at any moment, authorities could have come to evict them.
Then they got VERY lucky, to finally [after ten years waiting], got their Section 8 HUD housing assistance...and moved into an apartment that allowed them to use that...totally saved their bacon. That old house is still not sold, and they are still trying to get the last bits of their stuff out of there.....but then, many old properties in dire need of serious repairs, kinda have sat on the market for a long time around our region. Total gamble, but for them, it really helped them survive some very harsh circumstances.
Please seek legal advice in your State, to make sure this is handled properly!
Elder and estate attorneys would be a good place to start.
Area Agency on Aging [or whatever that has changed into these days], usually has volunteer lawyers you can make 30-minute appointments with, for free...but those are all kinds...most of those volunteering, may have little knowledge or expertise in this specialty....but they can sure point you in a better direction, and might be able to give good answers to basic questions.
Write up your questions ahead of time, keep them simple as possible...then be prepared to keep the lawyer on track to get answer....they like to go off on tangents!
Elder/Estate attorneys should be well-versed in knowing what, if any, exemptions apply in your case, and how best to preserve the property if that is more beneficial than giving it up.
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Llama - to me its not a ? on the NH being paid....if gran is on Medicaid she is required to pay her monthly income (like her SS) to the NH as her copay or SOC (share of cost) with state's Medicaid program paying the rest to the NH. It's more a ? of what happens with Grans house expenses while she is alive and then after she dies to reinburse Medicaid from any assets of Grans estate -which still has a mortgage! - via MERP.

KingConger - 2.5 years, that's not too too big of a period of time.
Although probability is gran will pass away before 2.5 years...I'm remembering reading that life expectancy once moved into a NH is 10 mo as they are ill & needing skilled nursing to be in the NH in the first place.

So have you added up all the costs? and can you & your dad easily & consistently all pay everything (taxes, mortgage, new insurance policies, etc)? Grannie will have zero -ziltch -no $$ to ever again pay on anything house.
Can you also save any $ as well? This is going to be quite important for a couple of reasons......some states allow the elders homestead to be an exempt asset for their lifetime BUT some states do not and require the home to be listed with a Realtor & MLS and placed on market within 6 mos or after the first year of NH residency as they are medically determined not returning home. If AL does this, you have to pay off the mortgage & buy the house at FMV from grannie if you & dad want to stay there. An elder law atty should know how all this works for Alabama, I'd get one who was NAELA certified as you have a lot of intricate issues. It's not a DIY project.

Do you have any idea of the tax assessor value on the house? You need to find the tax bill to see what amount of $ you are looking at for FMV & if it's accurate.

Your not likely to get any break either from mortgage co or Medicaid for staying & paying. Mortgage co doesn't care if a zombie pays the mortgage, only that it gets paid on time and house is properly insured. Some states Administrative code allow for regular & normal property related expenses (taxes, insurance, etc ) to be deducted from the Medicaid tally but this seems to only be allowed for vacant properties.

To me, family keeping a NH medicaid elders house is a lot like having a second home but without actual ownership so runs a risk. But if you have the purse or wallet to do this, are pretty OCD on tracking & documenting every penny and don't mind risk, then go for it! Most families seem to be all gung-ho at the beginning but run out of $, patience & humor with the house going up for sale within the first 6 mos. of NH admission unless they likely can qualify for an exemption or exclusion. Good luck.
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I believe Medicaid will want the house, else how is the Nursing Home going to get paid?
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The short answer is YES. Paying the mortgage on this home and having a verifiable paper trail is your insurance. You will be able to show other family members and Probate NO manipulation or stolen any asset has taken place.

Even if your Grandmother is on Medicaid you will be covered. However, If your Grandmother's property is being used to provide for her care, it is best to notify them of the circumstances. Looking at the entire picture if a Reverse Mortgage is in place you will need to contact the lender to notify of your Grandmother's move into a nursing home. Often with a Reverse Mortgage there is specific amount of time the home will remain hers. I have found most Reverse Mortgage holders allow only 30 days to provide access to begin to recoup their money.

The rule in 'how to handle property belonging to your Grandmother's is to dot your eyes and cross your tees. I believe having a lawyer involved is sometimes best and least expensive of all. Many states have legal aid available for just such situations. Know your rights and laws applicable in your personal circumstance.
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My grandmother is 82. She refinanced the house several times. It will be paid off in 2.5 years
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NJCinderella, if Grandma died ten years ago, this cannot possibly be a Medicaid lien, especially with tenants in there. Maybe some other kind of lien?
In 2006 property values were artificially high, possibly double what they are now. Compare nearby houses on Zillow or Trulia to get an idea.
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my grandmother's house has a lien on it...she died in 2006. house market crashed, can't sell it. there are tenants in it renting but it's been price reduced. 50% reduction since 2006! crazy! at this rate won't be much left if anything for Medicaid. then what, do they come after my 85 yr old dad?
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