Would Medicaid allow him to do that? Long story short, his goal is to somehow separate the 2 lots which are included in the original mortgage. The house sits on one lot. Other lot is trees, yard... He wants to free up other lot from original mortgage. I have no idea what his plans are for the lot. Is this something Medicaid would allow that?? I know mom retains ownership of the home until she passes. Separating lots would greatly reduce the property/home value. Of course, he will need mom’s cooperation & consent which she would blindly do.
First, is he concerned for Medicaid for him, or for his ex-wife?
Second, as JoAnn observed, legal interest and rights to the house should have been addressed in the Judgment of Divorce, or Decree. Was there in fact a new deed or quit claim deed executed and recorded after the divorce? If so, how was it titled? Your father's name only? Father and mother, jointly, with survivorship rights? Other?
Assuming they held title jointly when they were married, if there was no subsequent divorce deed recorded, then on record, your mother still holds an interest that has to be addressed.
Third, if the second lot was included in the legal description on the mortgage, it CANNOT be released w/o written consent of the lender. It's part of the collateral securing the loan.
Your father would have to get a written release of collateral from the lender, then record it, which in that process would notify the local treasurer of the release.
I'm not clear on what his intent is, though, as you indicated.
If he's still owner (and potentially co-owner with your mother), they're both still responsible for the lot, maintenance, taxes, etc.
Fourth, You wrote that you have no idea what he wants to do with this lot; that's something he should address before considering any further action, even though I doubt any mortgagee would release collateral, especially at this time when it's anticipated house values will fall b/c of the viral and economic situations.
Fifth, there's a good possibility that the local city or township would have to become involved to separate the lots, depending on how they're platted and registered.
Sixth, that raises another issue, i.e., specifically whether the other lot is a stand alone lot and could be sold and on which a home could be erected. In addition, is there access to that lot if it were sold?
Some areas have Subdivision Control Acts which prevent the sale of portions of property IF that remaining property would lack access, or be basically unusable. If that happened, and the lot were sold (and slipped by a scrupulous realtor), the lot wouldn't have much value as a stand alone property.
The title company for the new owner also may very well refuse to insure the property if it were unusable.
Seventh, if the property were in a western state with water and/or mineral rights, there would be additional issues. I see from your profile that you're in LA. Igloo (a regular poster here) is an expert on legal and real property issues in LA, and could offer insight on what other issues might be involved in a single lot sale.
If he's serious, post back and I'll PM Igloo and ask her to offer her opinion.
However, I honestly don't think your father could get past getting the lender's permission; it isn't going to allow anything that diminishes the value of its collateral, especially now with an economic decline in place.
If she only has a right to live in the home until her death, that may mean Dad is still a partial owner.
To do what your Dad wants would be sub-dividing the property. The Township he lives in would need to allow it. Not sure how the Mortgage would work in that respect.
If Dad is no longer on the Deed, he can't do anything. The deed should be filed with the County Court so you can find out if Mom and Dad share the property. I agree a good estate lawyer with a good deal of Medicaid knowledge is needed.
I would have assumed that the divorce filings would have issued the property to be sold or something. So mom lives in house, dad lives elsewhere. It is one lot.
Does mom have POA on file? Who takes care of her? Does she have Dementia or ALZ?
DOES SHE HAVE A LIVING TRUST? DOES YOUR DAD HAVE A LIVING TRUST? HOW OLD ARE THEY?
HOW CLOSE ARE YOU TO YOUR MOM? HOW CLOSE ARE YOU TO YOUR DAD? This is a sucky situation... your mom and your dad, trying to figure out things at this stage in life...If your mom is mentally unable to think, you better get that living trust and POA going now