If my elderly mother (VA spouse) applies for Aid and Attendance and then sells her home as a multi-year installment sale, how will that income be counted? Is there a better way to handle this? What about selling and purchasing another, less expensive house? In that case, the remaining profit could be kept under the income limit. Help appreciated, thanks.
To me it’s a bad, HUGE bad idea as too too much risk for mom.
Please PLEASE reread GardenArtists & MLx4 posts.
Those buyers need to shop around to find a lender who will do a standard 20 / 30 yr mortgage on mom’s house at appraised or FMV. Lenders exist. Mom gets the $ from the sale and uses it to buy an age in place friendly condo or small garden home assuming it makes sense for her to continue to live on her own.
Now if the buyers are totally credit unworthy that’s a different issue and if so no way mom should be selling to them. If the buyers are family and moms doing this to help out her favorite nephew situation, pause to realize that if say in 2022 mom needs a NH and applies to Medicaid as she doesn’t have the 7k-15k a mo that a NH costs and VA $ through Aide&Attendance isn’t high enough to cover NH costs.... that installment “sale” will pose Medicaid income and asset transfer issues for her.
Who will pay for mom’s NH stay if she’s ineligible for Medicaid in the future?
And there's always the possibility that the borrower will default and stop making payments.
I think purchasing a less expensive house would be a good consideration, if a smaller house actually suits your needs.
But with Aid & Attendance, a house sale may required some special consideration. I'd consult with the VA before making any decisions.
Contact your primary at the VA and ask to speak with a social worker, and ask her if there is anyone who can give you advice on this situation.