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Tamlynn, you are being given correct answers. Once mom spends down her liquid assets, you will need to apply for Medicaid. At that time you will have to disclose all of mom's financial information for the past five years. If there are any gifts of any kind, mom will be penalized for a period of time and the amount gifted that she will not be eligible for Medicaid.

We all work, pay taxes not with the idea that the government will pay for our care when we need it, but with the idea we need to save for our old age and the care we will need. It would be preferable to have assets to leave for our children and grandchildren, but that is reality only for the wealthy or those that die young.

See an elder law attorney in mom's state for state specific rules. Administration of Medicaid differs. No one here can give you a completely accurate response unless they are an elder law attorney in your state.

If granddaughter (is this your daughter?) Rents the house, it must be at market rates. When she buys the home it must be at market value. Any rent money goes to mom to help pay for her care.

Sorry you are not getting the answers you had hoped for, but what you are being told is reality.

Now, if granddaughter were to provide grandma medically necessary care, as determined by mom's doctor, for a period of two years, the house could become granddaughter's and exempt from Medicaid recovery. Would you really want your daughter to do that? Check with an elder law attorney in your state.
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PowerOf3 Jan 2020
GladImHere...You’re so smart and well spoken. That’s perfect advice and the loophole I believe was in hopes of being sought. I wish you were my neighbor. Hope you’re New Year started off fabulous 😉
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If the "mother" is in a facility that is being paid for by the government, then all of the assets are depleted prior to the government being willing to pay.  That is only fair.  Why should tax payers pay for her care when she has assets that could pay for her own expenses. 
If she is privately funding her care with her own savings and retirement accounts, then she can do whatever she wants with her home.  Rent it, sell it, let it sit empty... that is her choice or her family's choice. 
But if the government (tax payers) are fitting the bill, the house must be sold to pay what can be paid prior to government assistance.
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Tamlynn1966 Nov 2019
Jjust so you know, we are currently paying for her care with her own money at this time. My mom worked until she was 70 years old and paid taxes like everyone else. I will be proud if my tax money goes towards her care. Her house is not considered an asset by the government until she passes. We are planning on selling it to her granddaughter to help pay for her care when she can. Sometimes families have to stick together and help each other out. You might feel a little more compassion if you were the one in this situation!
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If you do a rent to own that is considered income for your mom and might disqualify her for Medicaid.

She would have to sell out right and use that money to self pay if her retirement income and the rent are not enough to pay for her care.

If she is currently on Medicaid and the house has been rented out, you need to notify Medicaid. If you get caught cheating, not saying you are, she could loose her Medicaid benefits permanently. It is not worth the risk because they will find out.
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Tamlynn1966 Nov 2019
We are currently paying for her care out of her own pocket at this time. Her house is not considered an asset to receive Medicaid assistance. Do you think you are the only tax payer in the world. My mom worked until she was 70 years old. She paid taxes like everybody else.
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Here is a different approach.
1. is your mother currently on Medicaid and she pays all but small personal needs allowance to nursing home? The house may already have a lien on it from Medicaid and can’t be a rent to own with “clear title”.
2. All her money going to the nursing home or assisted living is not the entire bill for her care if Medicaid is already involved. The difference between what the care costs and the amount mother actually pays is creating a debt that has house as security. Check with an attorney experienced with your state’s recovery process for that debt to see if this is an option.
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Since she will not have the money to pay for up keep and so forth, usually the home is sold.
Do you mean to rent it out? The income would have to be use to pay for her care.
do you mean have family move in? Will they pay for the up keep? It might be considered income to her. Hopefully they wouldn't just let it fall apart?

there must be a back story that will help to know your intention
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We were considering doing a rent to own with the rent going towards the down payment. Which in the end would be going towards her care
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You would need to run this by Medicaid and a lawyer.

Just a thought and u can ask a lawyer...I would think the money you receive on a rent to own would have to be set aside. What they use to "rent" is used as a down payment towards a Mortgage. We had a realtor post a few days back, maybe she can chime in.
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PO3, thank you, appreciated. Looked at your profile, I would never live California. But, I will be around here, for awhile anyway.😉
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