What are our options for paying for my mother's assisted living housing costs?

3 answers | Last updated: Nov 15, 2016
Robert. asked...

My mother is 81 years old, was diagnosed with Alzheimer's about 8 years ago. Physically, she is the picture of health. She has been living in an assisted living facility for the last three years. In six months, her savings will have been depleted. My two siblings and I will have to start paying her bills, which, after deducting her Medicare, come to about $25,000 per year, nearly all of that being housing/care costs. My first question is this: am I right in surmising that there really is little if any financial help we can get for my mother? She is not yet ready, physically or mentally, for a nursing home, so Medicaid, I think is not yet an option. My second question is this: my siblings and I are thinking it might be easier on us to get a lump sum loan to pay for her bills for one year (thereby allowing us to pay off the loan over the course of a few years), at which time we think she might be ready for a nursing home that Medicaid may help pay for. Are there loans like that available, or would we just have to try to get a regular personal loan. My sister is the only one of us who has a mortgage, so I don't think we can do any finagling in that area. Any advice would be much appreciated.

Expert Answers

Maria Basso Lipani writes a popular website on geriatric care topics, where she puts her expertise as a Licensed Clinical Social Worker to good use answering care planning questions. Maria is a graduate of Columbia University School of Social Work and is licensed in California and New York.

Hi Robert,

Once personal savings are depleted, there is no source of financial assistance to cover the costs of housing or care except for certain long-term care insurance policies and Medicaid.  This is why reverse mortgages have become popular in recent years. This option allows a homeowner to tap into the equity in their home (assuming it has equity) while the person who inherits the home inherits the mortgage and can pay it off over time. Similarly, funds acquired through a personal loan could be used for care and paid off over time - unfortunately I’m not aware of any additional types of loans that could be used for this purpose.


If you and your siblings determine that the personal loan is the way to go, I think it makes sense in this economic client to shop around for the lowest interest rates first, and to ask the person with the best credit to submit the applications.


Community Answers

Kona answered...

Hi-  Is your Mom perhaps a widow of a veteran or a war veteran herself?  If so, I just learned of a Veteran's Aid and Assistance program.  My widowed mother in law is 88 and her former husband was a veteran and it looks like she qualifies for some financial assistance with her assisted living rent. 

You may want to join a caregiver's group, talk to some elder case managers or a geriatric specialist who can point you in certain areas.  It takes a lot of time, but I've learned some interesting things!  There's not too many options if she doesn't have long term care insurance, isn't in a nursing home plus out of savings and on medicaid.  If your sibling has equity in their home, an equity line (2nd mortgage) may be an option.  Prime is very low, so s/b under 4% at most banks, much lower than an unsecured personal loan.  Good luck!!! 

Elias answered...

Hi Robert,

I recognize this answer is a bit belated. Two programs in particular can help. One is a Veterans Aid and Attendance benefit and the second is a Senior Living Line of Credit.

On the VA Benefit: If she is a surviving spouse of a veteran or a veteran herself, the VA provides to eligible vets an "Aid and Attendance" benefit. Thousands of communities work with advisors that can help you apply. The benefit can be as much as $1,000/mo or more for assisted living. So if you haven't looked into it yet, please do.

On a Senior Living Line of Credit: Thousands of communities offer families the option of taking advantage of a line of credit for senior living to pay the month to month cost of a loved one's care. Ask your community if they offer such an option. Typically, you can be approved for an entire amount up front, draw it down monthly, and pay it back over time. Typically such lines allow for the entire family to join and share in paying back the monthly payment, so that one sibling doesn't carry the burden. It also enables you to segment your obligation so that it is not co-mingled with your own home equity.

A loan requires you take the entire proceeds up front. A line of credit approves you for a credit limit and you use only what you need as you need it. Be sure to ask for not only the rates, but any penalty rates on the odd chance you are late with one payment, and any fees associated with taking out such loan. A line of credit for senior living can give your family's monthly budget some breathing room, by enabling you to pay back what you used in smaller monthly payments.