How to Protect Your Home from the Nursing Home

Do you worry about what will happen to your house if you have to go to a nursing home?

You’re not alone, many people do.

The good news is that you shouldn’t have to sell your house to pay for your care. However, to preserve your house for your heirs, you need to plan. Otherwise, Medicaid may claim your house after you die. 

The Risk of Losing Your Home

Your home (up to $713,000 in equity) is not counted as an asset when you apply for Medicaid. This means you do not need to sell your house to pay the nursing home before you can receive Medicaid. 

However, after your death if Medicaid has paid for your care, at all, it will submit a bill for repayment to your Estate in Probate court. This is where you could lose the house if you haven’t planned properly.

How to Protect Your Home

An Enhanced Life Estate Deed avoids this by keeping the house in your name during your lifetime. You retain the right to live in the house and all of the control you currently have as its owner. You can mortgage it, sell it, or do whatever you like during your lifetime. 

If you still own your home upon your death, the deed passes your house to designated beneficiaries, without Probate. Because you haven’t given anything away during your lifetime the Medicaid Lookback doesn’t apply and there is no Medicaid penalty. The transfer of ownership is therefore free of Medicaid’s claim. 

Other Benefits of an Enhanced Life Estate Deed

There are other perks to an Enhanced  Life Estate Deed and some potential downsides as well. Like all estate planning devices, whether a Life Estate Deed makes sense for you depends on your individual situation which is why you should consult an experienced attorney to discuss your needs.