I recently got an off market deal, but I am unable to finalize it because the seller doesn’t know if Social Security is able to take the home for payment to the owner’s nursing home. They have spoken to Social Security but they didn’t get a clear answer.
Rental Property Investor · Olympia, WA · Member since 2012 · 543 posts · 311 votes
6y
Is there a lien on the property? If no lien, and the transfer of title takes place before the lien, then the SS Administration will not be able to sieze the house -unless they can prove in court that the transfer to you was done far below market with the intent to avoid their debt.
I recently got an off market deal, but I am unable to finalize it because the seller doesn’t know if Social Security is able to take the home for payment to the owner’s nursing home. They have spoken to Social Security but they didn’t get a clear answer.
Likely the owner's relative is confused and it is not Social Security but the state government agency that is responsible for implementing Medicaid.
They can lien the property. But they can also give a notice by mail for the government's right to payment, including real estate and vehicles. You should ask if they received a letter and if so can you read it. That will tell you the exact claim being made. Likely it includes words that covers all assets.
Is the person still alive? If so, the costs are continuing if she is in nursing home status. Can she sign to sell? If not, does someone have POA to sell? If so, then they should call the number on the letter for the amount owed to pay that off. Then they likely have to set aside the other money for her nursing home expenses until it is spent down to the allowed amount, something like $2000. The Medicaid payment to the nursing home will be stopped until the house money is spent, otherwise its fraud and jail for the heir doing this. They can not just take the money when the owner is getting Medicaid payments for her nursing home expenses. The value of any of her sold assets needs to pay for her owed bill to Medicaid and the remainder set aside to pay her future bills until is it down to the allowed amount for her to keep for personal expenses, then Medicaid kicks in again to pay for the rest of her bills.
Medicaid does 'look back' at all her past $ and where it went. Some states are VERY aggressive in this. Likely the person selling the house will not get a penny. Medicaid will get it all in the end.