Hello,
My husband is in long term care and can no longer be at home. We have two houses and three vehicles. We would never qualify for Medicaid so I am wondering should I sell his cars or the second home first to pay for his care should our cash available funds be exhausted? There is more equity in the house and he did promise his cars verbally to uninvolved Grandchildren.
This is an emotional and financial question.
He has stage V cancer that has metastasized to the spine.
appreciate advice
But, it looks like DH will not be with u much longer. So, I would not do anything drastic. If he passes are you going to want the upkeep of two houses? So maybe selling one is a good idea. I think your best bet is to talk to a financial advisor. He can help u balance the pros and cons. You don't want to jeopardize ur future.
I will suggest that you try to keep things "fair" with the grandchildren. Be kind in how how you break it to them that circumstances have changed. If they are old enough to drive, they are old enough to understand that a gift isn't a gift until it is actually received.
It would be fair to give the grandchildren first right of refusal; offer to sell them "their" car at a fair price, e.g., the carvana offer or blue book private party value. If you plan to do this, know what your number is before you begin the conversation.
It would be unfair to sell two cars and give away one.
I find that extra cars are just extra expense and hassle - insurance, repairs, etc. My husband has always loved his cars and we always had far more cars than drivers (we were once offered a "fleet" discount by the insurance company!). They are easy to sell but won't bring in too much money unless they are collector's items, in which case they are harder to sell. So selling the cars may give you an extra month or two of care but isn't any long term solution but it is one less thing to deal with and if they aren't being maintained and driven then they will lose their current value. The issue of the promises to grandchildren shouldn't enter into your decision. Promises to grandchildren are nice to make but harder to keep. If you are looking for funds then the grandchildren will need to understand that this is a promise that was made in good faith but isn't able to be fulfilled. If they can't understand that money for care is more important than them getting the car then it's time for them to grow up.
Selling the second home will net you far more money and may be sufficient to not worry about his care bills but you need to determine if you need or want to have that home for your own use later on. Selling a home comes with its own set of complexities which you may not want to do right now.
As for the house, if your husband isn't likely to live very long, you'd save on capital gains taxes if you were to inherit the house and a new cost basis after he passes away rather than sell it now. (That's assuming you've owned the second place for a while.) It's complicated to explain, and I'd probably not get it exactly correct, so contact a financial adviser to get the details.