The Reverse Mortgages And Medicaid

Because the money comes from the home equities

, which have been saved through many years and paid from the salaries, there should not be any difficulties with the Medicaid. However, a senior must make clear, what are the terms of these loans and the Medicaid to avoid the sad surprises.

1. What Do The American Fear?

The American seniors honestly fear, that they must go to the nursing homes. The question is not only about losing the privacy, but about the prices of these homes. Depending on the location they may easily cost between $ 35.000 - 150.000 an year.

Most people end up to paying nursing home care until their savings have been used. After that they can qualify Medicaid to pick up the costs. It is important to know, that the Medicaid costs are only about 9 % of the nursing home costs.

When a senior wants to do the financial planning for Medicaid, he makes it sure, that he will move his assets away, so that he will not any more be the owner of those assets. Congress has established a period of ineligibility for Medicaid for the people, who transfer the money. The transfers must be done carefully following the penalty rules of the Congress.

2. The Seniors Want To Live In Their Old Homes.

They prefer places, where they have raised their children and where all their loved people are. The only problem is the money, because in some cases they have not enough money to follow this alternative. The reverse mortgages are special products with which seniors can borrow money against the equities of their homes and to turn that into cash monthly money.

3. The Cases, When The Cash Is Not Seen As An Income.

The reverse mortgage payments can influence your eligibility for the Government benefits, like Medicaid. A general rule is, that the income from the reverse program is not counted as income, if the money will be spent during the same month as it has been received.

If you do not spend the money during the same month, they can accumulate and push your resources over the allowed limits for SSI and Medicaid. The payments from the reverse annuity mortgages can be counted as income, whether they are spent or not during the same month.

As you can see from the points in this short article, the danger to lose the Medicaid is great if a senior works without an expert guidance. The Government has organized the counselor network, which is full of good experts, who are eager to help a senior. One good source of useful tips are the other seniors, who have already met and solved this problem.

by: Juhani Tontti

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