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Old 11-07-2012, 01:05 PM
 
Location: Living on the Coast in Oxnard CA
16,290 posts, read 29,680,800 times
Reputation: 21809

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My next door neighbor is 87 years old and as of this writing in fairly good shape physically and mentally. He bought the home in 1973. Three years ago his wife was placed in a long term care facility. Due to his fixed income he could not pay for cost of care and housing at the long term care facility and Medicare picked up the tab. So far so good.

It turns out that they like to go after assets that a party may own to recover the money that they have spent on the family member. In this case a home valued at somewhere close to $300,000. Medicare would like to recover $180,000 owed for the care of my neighbors wife. They have a lean placed on the home and when my neighbor passes away will exercise their claim on the property.

He has one daughter who is now retired and living with him to help him out. She has a home in another city and has no desire to own this home. She would like to see the home sold when her father passes away, which in his case may be 20 years from now. Her own health is not so great and she does not want to take care of this older home.

Here is where I come in. Over the past couple years we have become friends and I have learned of their concerns with the home. My wife and I are in a position to make an offer when the time occurs. Has anyone dealt with homes in a similar situation? Would it be advisable to contact Medicare or just wait for a sale to occur.

I have no idea how a lean affects a home that is being sold. The owners paid this home off years ago. We like the home, it has been well taken care of, and is next door to our home.

Last edited by SOON2BNSURPRISE; 11-07-2012 at 01:22 PM..
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Old 11-07-2012, 03:00 PM
 
Location: The Triad (NC)
31,941 posts, read 73,495,494 times
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Quote:
Originally Posted by SOON2BNSURPRISE View Post
My next door neighbor is 87 years old and as of this writing in fairly good shape...
He bought the home in 1973. Three years ago his wife was placed in a long term care facility.

In this case a home valued at somewhere close to $300,000.
Medicare would like to recover $180,000 owed for the care of my neighbors wife.
They have a lien placed on the home...

He has one daughter who is now retired and living with him
She has a home in another city and has no desire to own this home.

The owners paid this home off years ago.
We like the home, it has been well taken care of, and is next door to our home.
Does Dad want to go live with daughter?
Is daughter willing to have Dad move in with her?
Does Dad (and Mom) want to sell the house?
Do Mom and Dad have legal representation to advise them?

Any competent RE attorney can draft a contract to make a sale happen.
But unless they're all prepared to close the sale soon...

The main question is what to do about the difference between the Medicare (or other) lien
and the current fair market value of the property of "somewhere close to $300,000"...
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Old 11-07-2012, 03:54 PM
 
Location: Living on the Coast in Oxnard CA
16,290 posts, read 29,680,800 times
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Mom has died. Daughter will be there till the dad dies, or she dies. He is 87 but in good health. She is in bad health. She would prefer to sell the home and live in her place. I should have explained this. The reason that they were telling me about the lean is that his wife had died. They were looking at what they should do for now. From what they were told they can stay in the home untill he dies and then Medicare will want there money.

I am not sure if Medicare tacks on interest or not. Either way the home is valued currently at $300,000. Who knows what it will be worth when he dies. As far as I know the balance of the value of the home would go to his estate. I just want to be the first to have the opportunity to buy the home, maybe if possible before it hits the open market.

Which leads to another point. Would medicare or who ever handles the sale take the first offer they get just to get the sale done. Lets say that you have an offer and it is at or near what the market is going for, would they want to just get it done and call it a day?
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Old 11-07-2012, 04:53 PM
 
7,100 posts, read 25,877,798 times
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I think that you have mixed up Medicare and Medicaid.

I don't think that Medicare pays for long term care. If she went directly from a hospital to the home, I think it pays for only 120 days.

MediCAID takes over for those that do not have funds. And it does require (varies from state to state) certain assets be used.

If daughter has a house, they should sell Dad's house, pay off the lien and use the rest of the money now for themselves. that way, should he need NH care, he would be eligible for Medicaid with no problems as he would not own a home.

I'm pretty sure that this is not a Medicare case.
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Old 11-07-2012, 05:26 PM
 
11,115 posts, read 17,552,740 times
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Quote:
Originally Posted by SOON2BNSURPRISE View Post
Mom has died. Daughter will be there till the dad dies, or she dies. He is 87 but in good health. She is in bad health. She would prefer to sell the home and live in her place. I should have explained this. The reason that they were telling me about the lean is that his wife had died. They were looking at what they should do for now. From what they were told they can stay in the home untill he dies and then Medicare will want there money.

I am not sure if Medicare tacks on interest or not. Either way the home is valued currently at $300,000. Who knows what it will be worth when he dies. As far as I know the balance of the value of the home would go to his estate. I just want to be the first to have the opportunity to buy the home, maybe if possible before it hits the open market.

Which leads to another point. Would medicare or who ever handles the sale take the first offer they get just to get the sale done. Lets say that you have an offer and it is at or near what the market is going for, would they want to just get it done and call it a day?

The owner does not have to put the house on the market with an agency. If he is competent to sign a deed, then he can sell it to you directly.

The first thing to do is find out who is on the deed. The daughter and other siblings may be on the deed also, or the husband would have inherited directly from the wife. If the daughter is on the deed, she will inherit from the father most likely when he passes.

Do not contact Medicare/Medicaid. Get an attorney to handle the sale of the property and he/she will first obtain a copy of the deed and the attorney will speak to Medicare/Medicaid. The attorney will pay off the Medicare/Medicaid lien and, very important, will negotiate with them to possibly settle for less than the full amount of the lien.

The property will have to be appraised by a certified real estate appraiser. The difference between the amount which goes to pay off the lien, and the sale price, belongs to the seller. If there are other liens on the house, possibly property taxes, etc., all liens and taxes have to be paid at the closing as well so that you can get a clear title.

All in all, it will be worth your while and that of the seller to engage an attorney, asap. The correct legal term is lien. You will have to talk to the seller about all of this before speaking to an attorney, the seller has to agree to sell the property to you, and the attorney will represent the seller.

Hope this helps. Let us know how it turns out pls.
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Old 11-07-2012, 05:42 PM
 
Location: Salem, OR
14,988 posts, read 36,876,426 times
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You are a bit confused. Medicare/Medicaid won't ever own the home. They only have a lien. When the dad dies, his estate will sell the home and pay off the medical bill at that time. It isn't like the bank owning a property or the county seizing it for unpaid property taxes. You would purchase it directly from the dad or from the estate when he passes.
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Old 11-08-2012, 07:59 AM
 
Location: Living on the Coast in Oxnard CA
16,290 posts, read 29,680,800 times
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Quote:
Originally Posted by Silverfall View Post
You are a bit confused. Medicare/Medicaid won't ever own the home. They only have a lien. When the dad dies, his estate will sell the home and pay off the medical bill at that time. It isn't like the bank owning a property or the county seizing it for unpaid property taxes. You would purchase it directly from the dad or from the estate when he passes.
OK Good, so no problems there. Who ever is taking care of the estate then would be the party to talk to. The lien will be satisfied from the proceeds of the sale and all is well. Good.

The real question is can my wife and I get in line ahead of other buyers. Lets say that the home is put up for sale when my neighbor dies. Can we pre arrange to purchase the home from the estate without it hitting the open market? Can an attorney draft up a sales agreement for a future sale? What we want is for the estate to visit us first and say the home is for sale. It will be sold for $XXX,XXX.XX (what ever the market rate is) would you be interested in buying it?

Last edited by SOON2BNSURPRISE; 11-08-2012 at 08:13 AM..
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Old 11-08-2012, 08:13 AM
 
5,915 posts, read 5,549,935 times
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Medicaid is looking to the value of the home to pay for the wife's ongoing care. Medicaid will likely want the entire value of the home, because the wife isn't gone yet. Also, a probate court would have to approve the sale to make sure that it isn't being sold for less than market value, because then the State would wind up having to pay for wife's nursing home. So if you really want this home, at market price, fine. But if what you're looking for is a great price on it, look elsewhere. This one is gonna be complicated.
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Old 11-08-2012, 10:11 AM
 
Location: Living on the Coast in Oxnard CA
16,290 posts, read 29,680,800 times
Reputation: 21809
Quote:
Originally Posted by parentologist View Post
Medicaid is looking to the value of the home to pay for the wife's ongoing care. Medicaid will likely want the entire value of the home, because the wife isn't gone yet. Also, a probate court would have to approve the sale to make sure that it isn't being sold for less than market value, because then the State would wind up having to pay for wife's nursing home. So if you really want this home, at market price, fine. But if what you're looking for is a great price on it, look elsewhere. This one is gonna be complicated.
I mentioned in my second post that the wife has passed away and this is the reason that my neighbors were talking about the lien on the home. Sorry for not mentioning that in the first post. The home will not sell untill the husband passes away. I just want to buy the home and homes in this range sell fast in our area. In my part of the city a home valued at $300,000 is a starter home so to speak. The truth though is that their home is smaller than mine and may appraise for even less than $300,000. That being said, we are prepaired to buy it at the market rate. In our area homes in this range sell quickly, either to first time buyers or investors. I just want to be able to move on it when the time comes.
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Old 11-08-2012, 11:29 AM
 
Location: Mokelumne Hill, CA & El Pescadero, BCS MX.
6,958 posts, read 20,832,120 times
Reputation: 6430
I had a client who purchased a home with his mothers funds because one of the agencies (I'm not sure if it was Medicaid, Medical or Medicare), can't take a personal residence but they could draw down bank accounts until they impoverish the person.

As for being first in line to buy, you could pay for an option to buy the property for the appraised price at a date uncertain in the future.
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