My sister (66) has been in a nursing home for a year and owns a condo. She is on Medicaid. Would my sister be able to sell her condo to us or even take over her mortgage?

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She is 66 years young and is on Medicaid. Her intent is to eventually come home but sadly, as the days and weeks go by, that seems less evident. She cannot walk or transfer and needs a high level of care. Right now my husband and I are paying her mortgage, HOA and a few other bills. We cannot continue for much longer. Would my sister be able to sell her Condo to us or even take over her mortgage? I question Medicaid rules in this situation. She lives in Florida. Thank you.

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Basically you will never be able to recover what you already paid. You will have to buy at fair market value and you just answered your own question that you cannot continue. Did you check to see if there is a lien? Once she passes Medicade will want to recover the value from whatever real estate she owns.
To me there’s two different but interwoven hurdles in this: Mortgage and Medicaid. I’d first start with mortgage co.

Mortgage: I’d be really careful as to how mortgage is contacted. It needs to be your sister who does this so no alarms set off by mortgage co. Personally I would not send a letter to them by you as dpoa but have any correspondence be “done” by Sissy. Or everything done on-line as Sissy. If you don’t have the mortgage contract you need to get it AND find out what the payoff will be. I’d ask for payoff figure for JAN, 2018. This gives you basically a mo to figure out if you & hubs can afford it. And how to structure the $ to pay off mortgage so that it is a legit loan from you to Sissy - otherwise it (& like all the rest of the $ you’ve paid on sissy’s place) will be considered gifting & done out of a sense of familial duty by you to sissy by Medicaid.

If you can afford the payoff, then you try to negotiate with mortgage co on the amount needed to cancel mortgage. You just cannot take over her mortgage per se. You & hubs would need to have old one cancelled with a Release of Deed of Trust done by mortgage co. Then sissy could sell to you. As MACin CT said, has to be FMV. You can use tax assessor value but if that figure seems incorrect, you can also get it independently appraised. Appraisal if done correctly is a legal document. If it has house coming in at lots less than assessor figure, that’s legit. Now medicaid might not be thrilled but it’s valid. Probably best way to get a conservative appraisal done is to have property inspected & strucural engineering report both done & these given to appraiser to take under consideration for their reprt.

Medicaid: the $ from the sale to you will be income for the month received and then assets afterward for Sissy. It will take her over Medicaid 2k asset limits for eligibility. Sissy will need to do a spenddown & reapply for Medicaid. What & how to me kinda dependent on the amount house is sold for. 100k ++ will mean months of private pay at NH. 50k or less.... sissy may be able to do a huge spend down in a single month (funeral, burial, dental, speciality wheelchair) to get down to 2k. But for this approach, it kinda has to be thought out where $ is to go in advance & schedule act of sale like on the 1st or 2nd, so you have just about a full month to get everything paid for and cleared through Sissy’s checking account, so she clearly starts the next month within Medicaid financial limits. To me, all this will kinda be a nearly full time job for you for a couple of months to get all done OR Sissy hires an atty to do all this with the $ for payment to come from the proceeds of the sale.

Did you ask if Sissy state allows for a diversion of the copay each month to cover her mortgage? Some states do. TX does but it is a waiver that has to be applied for and seems to need property to be under a Realtor MLS listing & is time limited. If your buying the house isn’t feasible, I’d find out about getting a waiver of her copay to use for mortgage.  Makes sense for states to do as it keeps it from foreclosure & no recovery of any equity in home by the state for Medicaid costs paid. 

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