Her children did not transfer any of her assets so she has been paying the NH for about a year. She has about $50,000 left and she owns a house. We are in the process of spending down her money making sure everything is spent on her care and needs. She is 98 years old and was in good health until she broke her hip. She has not recovered enough to walk. She has dementia and some days has a hard time coming up with what she wants to say. My question is should we sell the house and just use the money to pay the nursing home as long as it lasts or keep the house? If we keep it, there are taxes, insurance and upkeep. She will not have any money for this. Unfortunately my husband will probably be the one to have to pay it. If we don't sell it, it will just be sitting empty until she dies. There is still furniture in the house as well as her personal items like picture albums, clothes, etc. Are we allowed to remove those things regardless of what we do with the house?
It will make it all simpler.
Otherwise, once shes at 2k in assets then you/hubs will do all the paperwork for the medicaid application & she will qualify. But once house sells, the house sale $ will make her ineligible for medicaid. So another spend-down till she's impoverished again, followed by re-applying for medicaid again.
Any costs incurred by family on the house cant be easily reinbursed from the sale as that $ will more than likely be viewed as "gifting" from mom to you by Medicaid. So sale kinda needs to all be done now while mom still has fund$.
Vacant dwelling policy. If mom still has her old homeowners policy, it may not be valid. Pls, please check with her insurer ASAP. VDP are somewhat pricey. It will be more than likely sold by independent agent. Basically its a limited fire policy. If its going to be listed, or have workers doing repairs, you may need riders.
Medicaid doesn't "take" the house per se. Its not like a mortgage co that can foreclose on property & sell it. Mortgage co is secured creditor; medicaid is unsecured. What Medicaid can do is to place a lien or a claim on the house - either of each places a cloud on the title. Just which path is inter-dependent on your states laws. So whomever is the DPOA or executor is going to end up doing the paperwork related to selling or transferring the property one way or another. The only way around this would be for mom to walk on anything on the house & not pay taxes and let it fall to a tax sale deed (or redemption) after a few years.
But I think that qualify of life is a factor here. Granted, it's a challenge to plan for care with the unknown factor of longevity. But I also think that moving to a facility is challenging enough with the place being of lesser quality, such as I believe Medicaid facilities have (based on posts I've read here).
If my parent's last years are going to be away from home, I'd want something that is as good as possible, not something where less is offered b/c Medicaid facilities don't provide as much as private pay ones.
There will be enough caregiver guilt and recrimination as well as self reflection on whether I did the best I could, w/o wishing I hadn't planned for state assistance which might never occur.
Just my $.01worth (with inflation factored in).
Selling "as is" is easy as most Realtors know how to work with client who is looking for a flip house, or a house to live in while remodeling. I did that with my Dad's house once he moved into senior living. He didn't want to fool with the house any more, it was just too much work for him.
I will be facing a similar situation soon with my folks house. It will be an as is sale, the house isn't worth much but the land is quite valuable, mid 6 figures possibly.
My inclination would be to sell when folks go into care thus insuring plenty of bucks for quality facilities. Depending on life span they have enough funds for maybe 3 to 5 years of private pay without using proceeds from the house and land.
Folks have advised me to not sell until after death. Spend down current funds, apply for Medicaid and settle with Medicaid when estate is dealt with.
The theory, I think, is that facilities change much more for private pay than the Medicaid rates so at the end my Medicaid reimbursement is less of a chunk of money than private pay would have been thus larger inheritance for family.
Sounds greedy I know. But is this a common method?