@BelknapPoint Okay, well, they only did the vacations, because they wanted my siblings and I to experience the world. I’m sure you take vacations. A cruise for four people is close to $10,000 after airfare, excursions, and the cruise itself.
Kingpin- don’t let yourself get distracted by what other people can and cannot do and what other people do and do not do. I was so happy to hear you’d met with a lawyer- I’m somewhat less happy now that it’s a friend of the family who in fact, does not specialize in elder law and the complications of estate planning.
But go in peace- make sure you and your grandparents call your insurance agent for a review to establish that the house as it currently exists- pool, kitchen, and all, are adequately covered. Read your property tax bill carefully to make sure that the house is being described accurately (I have neighbors who discovered that they’ve been paying- for several years- property tax on a finished basement which they do not have including a downstairs powder room which doesn’t exist. A previous owner filed to get a building permit to finish the basement and put in a bathroom but then decided not to go ahead or couldn’t get financing- but the city has been charging the property tax since then as if the house were improved).
So make sure you’re insured for the god knows whats and you’re paying an accurate tax bill.
And best of luck to you.
I can’t advise you whether transferring 99% of the property to you will save it from the medicaid claw back after 5 years. Even after the 5 year period has passed, if your grandparents are making payments on a home they don’t own, all those payments could be clawed back into the estate
In the last two days you’ve gone from never putting them into a nursing home to now making decisions based on avoiding medicaid (which they aren’t even qualified for) clawbacks. Make decisions based on how you want to hold the property.
You’re missing the point, which is understandable, because you probably think that I’m attacking you and your grandparents for spending $200,000 on a swimming pool and kitchen renovation and for taking annual extravagant vacations. Which I’m not. I mentioned upthread that those expenses are choices, which is fine. I’m not passing any judgment on that spending. My reaction was to your lamenting the fact that the house still has a mortgage on it, and thus you don’t have the same estate planning advantages as “the rich people.” You and your extended family enjoyed the benefit of the pool, nice kitchen and yearly extravagant vacations, when the money spent on those things could have been used to pay down the mortgage. You can’t have both, but the situation you and your grandparents now find yourselves in (and it’s by no means a bad situation) was of your own making. You shouldn’t be complaining about how “the rich people” have it better, at least as far as having a paid off house, when you and your grandparents probably could have been in the same position, absent some discretionary expenditures.
“was of your own making”
BelknapPoint- the OP is a 17 yr old HIGH SCHOOL STUDENT who lives with his grandparents.
He had NO CONTROL over how $$ was spent before he was EVEN BORN or when he was a little kid .
HOW is his current situation OF HIS OWN MAKING??
sheesh…
lighten up on the kid , will ya? 
Obviously it’s not.
ya think???
Family friend who doesn’t know elder law and Medicaid planning are a bad combination. Inartfully done Medicaid planning can (at least theoretically) result in jail time since 1996 or so.
Well then why the heck did you ask me? Also, OP is not a 17 year old high school student. He/she should have a bit more perspective about how near term financial decisions can have a long term impact, no matter who is doing the spending. Before you jump on me again, I’ll repeat that I’m not judging those decisions; I’m pointing out that past discretionary spending might have something to do with the position that the FAMILY now finds itself in regarding still having a mortgage on the house.
@BelknapPoint I’m 20. You don’t know the entire situation. My father caused the family a lot of problems - financially - and that is not repairable. My grandparents took on the burden of raising three children, while my other grandfather (my dad’s actual dad) lost everything (his home, assets, etc.) after my dad, who he cosigned on two homes that are now foreclosed, milked him for every penny he had. This grandfather now lives with his brother and gets $1,300/m from SSI. He was forced to retire after the housing market collapsed, since he worked in construction. What’s even sadder - he had saved up $50,000 to help my siblings and I go to college - but that was gone before we were even in middle school. Need I explain more?
Isn’t the OP already in college? I thought someplace she said she had completed the FAFSA already in the past…a S was 20. Ami I confusing her with someone else?
Regardless… @kingpin2 you need to see a lawyer who knows about real estate, and estate planning. A friend who doesn’t have any expertise in these areas is not what you need. This is a more complicated situation than a simple real,estate transaction…because of everyone’s desire to protect this asset.
You don’t need to explain anything, but I don’t see what any of this has to with spending $200,000 on a swimming pool and kitchen renovation and taking annual extravagant vacations. My point - again - is that if the money was there to do the things just mentioned, than it was there to pay down the mortgage as an alternative. One choice not necessarily any better or worse than the other; folks have the right to spend their own money as they see fit. But complaining about the consequences down the road (and I understand that you weren’t the person writing the checks) while you say that you are getting screwed unlike “the rich people” who don’t have a mortgage makes no sense.
OP, I suggest you see a experienced real estate attny.
I also suggest you ignore posters that seem to want to do nothing more than lecture you about the financial sins your grandparents committed.
It was not as if you could have done anything about it at the time, since they happened when you were a child.
The horse has already left the barn, financially speaking…
The OP came here for help, not lectures.
If you are doing all this transferring and re-deeding to avoid a medicaid clawback at some point more than 5 years from now, make sure that it will accomplish that goal. I don’t think it will if your grandparents continue to pay the full mortgage payment right up till the day they apply for medicaid and enter the nursing home. Whatever lawyer you use will have to understand what the purpose of the transfer is, and whether the grandparents can retain any portion of the title to the house. They may decide that since the grandparents paid, took the tax deductions, lived in the home, it is still their asset. All these transfers need to be done correctly or you are all just wasting your time and money shuffling deeds.
Hopefully, none of this is ever necessary. Your grandparents live a good long life in the home, you graduate and take over the house payments, no one ever goes on medicaid or into a nursing home, there is no clawback.
Please see an elder care lawyer, with or without or grandparents. Your family really need to learn how Medicaid works when it comes to elderly health care.
From what I can see, your grandparents made some questionable but understandable decisions (very nice two week vacations I wish I could take) out of love for their family. Now you want to return the favor Again very understandable.
The problem with all this is the amount of responsibility you are assuming is, well, of whack for a person your age and experience. Everyone on CC advise students and parents every day that colleges are not worth borrowing $100,000. Getting loans that size is just unsustainable. And yet, you are taking on a mortgage more than twice that amount after college graduation. THAT’S NUTS.
Yes, you are paying for a house instead of student loans but be very aware that in the end, money is money. You will be cash poor and very limited in your life choices. You won’t be able to move to another state, not even Maryland, because chances are you won’t have enough for a mortgage payment and rent in the DC area. You will be tied to the house for all those years you may have left with your grandparents.
Look, do well in school. Get a great paying job where you can and send money home to your grandparents. The Medicaid issue is theirs to handle. You, as a 20 year old college student, with limited life experience should not be dealing with this. Being grateful and loving does not mean sacrificing your early and middle adult years.
I agree with SlackerMom. This financial planning should be handled by your grandparents and their 40-year-old daughter. If she can offer them $100k to pay down the mortgage, she can pay for an attorney.
Why can’t she put the house in her name and turn it over to you later on if that’s what you decide you want? If I were you, I’d search out my own attorney to make sure my interests were being protected. Saddling you with a mortgage at 20 and extracting a promise that you’ll be responsible for your grandparents’ eldercare is, in my opinion, irresponsible behavior on the part of every adult around you. Dig up $100 and go spend an hour with an attorney who’s not a friend of the family.
Give me a break. Where did I ever say that the grandparents committed any financial sins? I didn’t. I have been very clear in saying I am not judging the choices made by the grandparents. What I am doing is pointing out to the OP that complaining about still having a mortgage on the house, such that OP and family don’t get the estate planning benefits that “the rich people” with no mortgage have, makes no sense, given that OP’s grandparents had the discretionary funds to pay down the mortgage over the years but chose not to do that. For some reason you fail to understand this.
If you had already graduated college, firmly planted in a career and with a good salary, then maybe this would be different, but you are still in college. In my humble opinion taking on a mortgage of this magnitude now is ill advised.
$250,000 mortgage for 30 years at 3,5% is a $1,100 a month payment. Plus upkeep, property taxes, insurance, utilities.
How much would that be a month?
Can the grandparents take out a life insurance policy in the full amount of the mortgage so that if one of them does the mortgage can be paid off? OP would be the beneficiary…if she is on the mortgage.
Life insurance on a 67 year old for $400k is pretty expensive.