Can creditors take a person’sprinicipal and only residence, to pay a hospital bill?
Get Legal Help Today
Compare Quotes From Top Companies and Save
Secured with SHA-256 Encryption
Can creditors take a person’sprinicipal and only residence, to pay a hospital bill?
The person is 81 years old and on medicare, but has no gap insurance. The kids are worried that her home could be taken to pay the hospital. Is it protected from creditors as a principal residence? It is paid off.
Asked on September 1, 2011 under Bankruptcy Law, Michigan
Answers:
FreeAdvice Contributing Attorney / FreeAdvice Contributing Attorney
Answered 12 years ago | Contributor
In all states in this country there are these laws created under the "homestead act" which purpose is to exempt from creditors a certain amount of equity in the home usually up to the first $100,000.
From what you have written, it sounds as though the eighty-one (81) year old person on medicare needs some estate planning assistance to protect his or her assets from creditors and to pass such to whomever desired.
One such means would be to have the home appraised and have the person you are talking about gift a fractionalized interest each year wo whom he or she wants up to the allowable amount under Internal Revenue Service regulations while reserving a life estate in the home.
IMPORTANT NOTICE: The Answer(s) provided above are for general information only. The attorney providing the answer was not serving as the attorney for the person submitting the question or in any attorney-client relationship with such person. Laws may vary from state to state, and sometimes change. Tiny variations in the facts, or a fact not set forth in a question, often can change a legal outcome or an attorney's conclusion. Although AttorneyPages.com has verified the attorney was admitted to practice law in at least one jurisdiction, he or she may not be authorized to practice law in the jurisdiction referred to in the question, nor is he or she necessarily experienced in the area of the law involved. Unlike the information in the Answer(s) above, upon which you should NOT rely, for personal advice you can rely upon we suggest you retain an attorney to represent you.