I have durable power of attorney and am my mother's trustee. As such, I am caring for my mother's home in case she cannot continue to afford her Assisted Living arrangements and needs to return home.
Years back, my parents entered into a reverse mortgage agreement. My father has since passed and I would like to make sure the proceeds from the sale of the house (when that time comes) go into my mom's living trust. She is not using Medicaid to pay for her living expenses so they will not be coming for proceeds at that time. My estranged brother and sister may try to get their hands on what is left of their estate though. This is not my mother's wishes, and would not be fair because I am keeping up the house, even updating it to keep it marketable in case mom should choose to sell it to pay for her living expenses rather than moving back into her home.
So, my question is, can the title/deed of a home with a reverse mortgage be altered to be included as an asset for a Living Trust?
The lender of any mortgage has an interest in being paid back, and transfers w/o its permission preclude it from examining credit of the mortgagor's assignee.
That's an issue separate from the trust issue though. In order to be "transferred" to a trust, the title of the deed would have to read something like "hmarriott's Mother, Settlor, as Trustee of the hmarriott's Mother Living Trust dated ________________, 2017 ." That's not the precise wording, which I don't remember now, but that's the jist of it.
Only with that deed properly drawn, executed and recorded would the property be an asset of the Trust.
So are we saying that a home in reverse mortgage, that is not above home equity in loan amount : equity ratio, cannot undergo a title/deed change?
The only way the title can be altered is with the concent of the mortgage company. You can place a new page on the title, just file it at the land office ..but, it is meaningless without the signoff of the mortgage company that holds the reverse mortgage.
As Glad says, review the terms of the loan. There is no sense in updating mom's home if the proceeds of the sale are going to the RM company. It sounds as though you could benefit from talking to an Eldercare Attorney.
In terms of Medicaid, once mom can no longer stay in AL, how do you propose nh costs get paid? Won't Medicaid be in the offing then?
If the RM was for a specific, smallish amount, perhaps you'd be better off paying with other monies of mom's and renting the house out. Or selling it.