Retired or semi-retired. Are you mortgage free? (spouse, states, payments)
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a spouse can legally just refuse to pay and the other spouse in a nursing home can not be put out on the street .
many do that the lawyer said and wait to see if medicaid sues them. in many cases where large amounts of assets are not had they either don't sue the other spouse or they work a cheap affordable deal.
Since in many states married couples are (1) both owners of all combined assets and (2) both liable for debts incurred by either one, I do not get how this is possible. IOW, if I am married and I incur debt by being in a nursing home, both me and my spouse are responsible for that bill. Do you have a web link on this?
Since in many states married couples are (1) both owners of all combined assets and (2) both liable for debts incurred by either one, I do not get how this is possible. IOW, if I am married and I incur debt by being in a nursing home, both me and my spouse are responsible for that bill. Do you have a web link on this?
it is actually federal law:
"Federal Medicaid law states that the community spouse can keep all of his or her assets by simply refusing to support the institutionalized spouse. This portion of the law, known as "just say no" or "spousal refusal," is generally not used except in New York and Florida, where the states have adopted the federal law in this area, and in Connecticut, where a federal court has upheld this right."
the spouse can be sued but it has not happened much. only a few states are actually using this tactic even though it is part of federal medicaid law.
it is federal law:
Federal Medicaid law states that the community spouse can keep all of his or her assets by simply refusing to support the institutionalized spouse. This portion of the law, known as "just say no" or "spousal refusal," is generally not used except in New York and Florida, where the states have adopted the federal law in this area, and in Connecticut, where a federal court has upheld this right."
"
"Under the law, if a spouse refuses to contribute his or her income or resources toward the cost of care of a Medicaid applicant, the Medicaid agency is required to determine the eligibility of the nursing home spouse based solely on the applicant's income and resources, as if the community spouse did not exist...."
Doesn't make sense since with married couples, assets and debt (no matter whose name the assets or debts are in) are the equal property of both spouses (as the assets and debts would be in a divorce). Maybe it's just my state that has that law?
the attorney we met with last night has sooooooo many clients that have just refused and to date no one has been sued. it is crazy ,i agree but the law is the law i guess.
what really prompted us to go was we knew someone who did that and they were pretty wealthy and never had any issues crop up from medicaid.
so we wanted to hear right from the horses mouth just what is going on with that since we are on the verge of taking a policy.
we searched out one of the most well known elder law attorneys and went to see him.
Last edited by mathjak107; 03-08-2014 at 04:41 PM..
We are about to semi-retire in 3 weeks. We sold our primary residence at a good profit and are moving to our mortage free vacation home in a nice resort community on the mid-atlantic coast. Just wondering how many semi or retired out there, still carry a mortgage? Sure everyones situation is different, but in general I would not feel good if I was still carrying that mortgage debt.
Just wondering what people think about this subject.
So we're carrying a mortgage on both homes, under 4%. If I could have borrowed a million at the low mortgage rates we nailed down, I would have. The record low long-term fixed rate mortgages will soon look like theft from the lenders, and my investments yield far more than these low debt rates.
I understand the desire to be debt free, but I would not liquidate productive assets to pay off 4% debt.
I have 2 houses, each with 30 fixed conv. and NO INTENTION of paying them off. One has a rate of 4%, the other is 3.875%. I do in fact have enough capital to pay 'em off but that'd be stupid as hell.
Why on earth would anyone pay off loans at rates a low as these?
Last edited by tommy64; 03-08-2014 at 10:35 PM..
Reason: fixin' up my spellin' and stuff.....
Because every penny out of your pocket in interest is money wasted. Especially when savings accounts, money markets, and CDs are paying such lousy interest rates (0.1%, 0.1% to 0.5%, and 0.1% to 1.5% - if you are willing to tie your money up at that rate for 5 years).
At my age I want nothing invested in risky ventures. Its just common sense not to carry a mortgage any longer than you absolutely have to.
A 30 year mortgage on 100,000 will cost you 161656.09.
If you pay the same amount off in 15 years it will cost you 128678.86
So paying a loan off early is like having an investment that pays you that much in interest - and you have roughly 33,000 more cash money to invest (in the above scenario) at the end of it.
Once the loan is paid off, you only have to worry about insurance and taxes - all that money you were spending on mortgage payments every month is also available to invest, if that really floats yer boat.
As for me - I owned my home free and clear for about 20 years, but now I am disabled and must move to a place more suitable to my limitations. The fact that I owned my home when I became ill means I didn't lose it because I have been without a job for most of the last 10 years. I could easily manage the taxes on it, where a mortgage payment would have been out of the question.
So now I can at least sell it, take the money, and put it towards something else. I will be carrying a small mortgage for awhile - but I will pay it off ASAP. Hopefully it won't be for long - I've been totally debt free for almost 25 years. Its annoying, and somewhat painful, to have to modify that situation now.
EDIT: The above calculations fail to take into account the difference in interest rate between a 30 year loan and a 15 year loan. Where I live, you can only get the 3.5% on a 15 year loan. For a 30 year loan the interest rate is 4.1% - so that 30 year loan will actually cost you 173951.41 - more than 14,000 more than the 3.5% loan for the same amount and period.
So the difference between the 30 year loan and the 15 year loan is actually about 47,000 - not just 33,000.
the attorney we met with last night has sooooooo many clients that have just refused and to date no one has been sued. it is crazy ,i agree but the law is the law i guess.
what really prompted us to go was we knew someone who did that and they were pretty wealthy and never had any issues crop up from medicaid.
so we wanted to hear right from the horses mouth just what is going on with that since we are on the verge of taking a policy.
we searched out one of the most well known elder law attorneys and went to see him.
I don't know about federal, but in Mass., if one receives any kind of gov't asstistance including Medicaid, the state can recover the amount of that aid from one's estate after death. So there's some confusion around this.
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