Expert: Jessica Bryan - 6/16/2010

Question
My mother in law's house has been on the market since April, 2009. She is in a nursing home.  Home is in her name only.  I have power of attorney.  Medicaid says we have to receive 90% of auditor's value.  The problem is it cannot be sold except as a conventional loan because there are huge electric power lines that go throughout the allotment.  We paid over $2000 to have an easement from the power company saying it was OK to buy the house however FHA will not loan money for a sale.  There is a lien on the property that was taken out by my husband prior to his death last year.  It was used to pay off all of her bills before entering the nursing home.  I can no longer afford to make these payments for the lien.  What suggestions do you have to be able to get the house sold.  We have had interested buyers but they don't qualify for a conventional loan.

Answer
Hi Mary;
I am not sure what the rules from Medicaid are regarding personal property and why you have to get 90%. However, since the home is in your mother in law's name only and she is in a nursing home, she cannot make payments on the home.  Perhaps it will have to be foreclosed upon.  If you paid to get an easement why won't FHA loan on this?  Were you assured that they would?  You might want to discuss this with the closing attorney you used. I am curious though...if the home is not in your name, why is this your responsibility? The lien is against the owner of record and my thinking is that she is not really capable of making payments now. It seems like Medicaid will pay for all of your mother-in-law's expenses once the home is sold so you should probably take it up with them to see what can be done to get an exception.  You can also talk to the bank with whom she has the loan (lien) and perhaps even an estate attorney.  If you are in need of professional advice but cannot afford any then you might turn to some of the state agencies who help with things such as this.  It takes time and diligence to get answers but it might be worth it.

Best wishes,
Jessica Bryan