When to file - house to be sold

Discussion in 'Selling of Home' started by 68TR6R, Mar 19, 2014.

  1. 68TR6R

    68TR6R Newbie

    Hello,

    First, I want to thank you so much for the VeteranAid website. It has been of immense help to me in understanding the A&A application process. I also have a couple of questions to ask. Here is some background info.

    My father was a WWII veteran. He passed away some years ago. My mother is now 90 and in need of assisted living. We found a suitable facility and we will be moving her in mid April. She has about 30,000 in assets and a retirement of about 1700 a month. She also owns a home worth about 100,000. We will be selling the house to help pay for her assisted living expenses. We have a good bit of work to do to get the house in shape and the market is still not that great so I expect the sale could be 3 months to a year off - possibly more.

    I am now in the process of getting the A&A application in order. My questions are these.

    1. Should we go ahead with the A&A application now and then notify the VA when the house is sold or should we wait until after the house is sold and her assets have been depleted below the appx 80,000 level?

    2. If we apply now and then notify the VA after the house is sold, my understanding is that the VA may reduce or suspend the pension. If that is the case, how do we get the pension re-instated after her assets fall below the 80,000 level? Is that done using the form 21-4138 or will we need to submit a whole new application?

    Again, thank you for providing such a great resource!
     
  2. vetadmin

    vetadmin Administrator Staff Member

    Once the house sells you will need to inform the VA of that. Until it sells, it is not counted as an asset.

    My concern here is that her monthly income and assets as they currently stand may have her over the income threshold. Her age will be cause for the VA to not allow her as much lead way as they would someone younger.

    Without knowing her monthly cost for care, how short she will be, and how quickly that shortage will deplete her 30K, we can't really make a recommendation on when to file.

    If you apply and she is denied, you have up to a year from the date of denial to update her finances if they would then be in line for the pension to be awarded.
     
  3. 68TR6R

    68TR6R Newbie

    Thank you for your response. It seems the best thing to do is wait until the house is sold and her assets fall well below the 80K.

    Thank you again for such a helpful web site.
     
  4. Max

    Max Hero Member

    Increases to net worth are not counted until the first of the year after the increase.

    This means that if she is approved before the house is sold and you sell the house, the increased net worth (which may temporarily terminate the award) will not take effect until January 1 of the next year. So if she applied now and got approved and then sold the house on January 2, 2015, she would have until January 1, 2016 to spend down her net worth to avoid the termination.
     
  5. InTheWoods

    InTheWoods Newbie

    VSR, do you know if purchasing an immediate annuity is an approved method of spending down or converting the asset to income? My father-in-law lives in assisted living and currently receives A&A, but will face a $2,000 (per month) loss of income in about a year. If we can sell his house and use the proceeds to purchase an annuity to pay out approximately $2,000 per month and combine that with his A&A and Social Security, his money will last twice as long as it would if he lost the A&A. He is 93, in good health due to a new heart valve, but has rapidly increasing dementia.
     
  6. vetadmin

    vetadmin Administrator Staff Member

    We cannot and do not recommend you doing this.

    If the house sells, you need to report that to the VA, and depending on the amount of proceeds, it will impact his pension.

    The VA is in the middle of trying to implement a 3-yr look back, and if that passes, you do not want to be pulled into that situation.

    If you sell the house, you should consider using those funds to make up the shortfall.
     
  7. InTheWoods

    InTheWoods Newbie

    I totally understand what you're saying. We are just fearful of what to do once he has spent the proceeds from the house. A&A plus Social Security is not enough to pay his assisted living. I suppose we just have to jump in and hope for the best. Maybe selling the house with seller financing or a lease option would work. Monthly payment may not be enough to get him by though. Just running all the options through our befuddled minds and trying to come up with a workable plan ahead of time.
     
  8. vetadmin

    vetadmin Administrator Staff Member

    Understand, but keep in mind if you lease the house, he will have to count the rent as income, which will impact him.
     
  9. InTheWoods

    InTheWoods Newbie

    Income will not be an issue as we will be replacing an upcoming $2,000 drop in his current monthly income. Trying to find the replacement income is the problem.
     
  10. vetadmin

    vetadmin Administrator Staff Member

    I understand.
     

Share This Page