Will transferring my mom's home to my name help protect it from additional liens?

2 answers | Last updated: Oct 18, 2016
Weblore asked...

I am Durable POA for my Mom with Alzheimer's. She owns her home out right with a value of about $130,000.00 My brother and sister in prior years had taken Mom's credit cards and run up unpaid debts of about $100,000.00. Two collection agencies have gotten judgment and placed liens on her home for about $50,000.00. The other 50K is still out in collection.

I tried to settle with these agencies but they will not give me a written letter that the debit would be paid in full. Can I transfer the home to my name to protect the remaining value before additional liens are placed? Would my personal assets be at risk for the liens in place on her home if I did transfer solely to my name?

I am anxious to preserve remaining value in the event I need to sell the house to fund her care. Thanks!

Expert Answers

Steve Weisman hosts the nationally syndicated radio show A Touch of Grey, heard on more than 50 stations, including WABC in New York City and KRLA in Los Angeles. He is a practicing lawyer specializing in estate planning and is admitted to practice before the United States Supreme Court. He's a public speaker and commentator who has appeared on many radio and television shows throughout the country, and he's the legal editor of Talkers magazine, the preeminent trade publication of talk radio. His latest book is The Truth About Avoiding Scams.

The first question that arises is were your brother and sister authorized to run up the charges on your mother's credit card? Were they co-signers? If they were not authorized to use the credit cards for their own use, why did you not dispute the charges when you first became aware of them?

If you transferred the home at this point to avoid creditors you would be violating the laws pertaining to fraudulent transfers of property which could invalidate any transfer of the home done by you so that is not a viable option.

As the agent for your mother under her Durable Power of Attorney, I suggest that you take seek payment of the debts from your brother and sister.

I urge you to contact a lawyer experienced in creditor-debtor law to help you with this matter. You also should look into whether you have any protection of the value of the home through your state's Homestead laws. The Homestead laws vary widely from state to state, but may well provide some protection or, at least, some leverage with which to deal with the creditors.

Community Answers

Weblore answered...

Thank you for your help.

They were each listed as authorized users but were able to have the individual bills/statements sent to each of them.

This was prior to my being POA. My brother was POA during this time.

I only discovered this when I saw a judgement notice come to her house. I pulled her credit report and was horrified.

Unfortunately my brother is now deceased and my sister is not likely to repay any amounts on this debt.

I am doing my best to clean up this mess and protect her only remaining assest which her her home.

What type of attorney would you recommend. Elder law? Creditor?

Many thanks, weblore