What are some cons to this situation?

[MushyMushy]

Just a little background: my father is in assisted living and is pretty much paying month to month. He wants to come home, but he's much safer and better off where he is. He doesn't have enough income to stay where is is and maintain his house, but we've been doing it since July. The house is a disaster -- about 50 years worth of hoarding in this 3 bedroom home plus separate garage. My sister and I have been cleaning little by little and now have the downstairs pretty livable. We just need to put a new floor and toilet in downstairs bathroom.

We've been tossing around the idea of renting out the house, BUT we know that means a whole ton of work ahead of us emptying the house and fixing it up (though we could probably rent it at a discount if the tenant is willing to work on it... very common thing to do around here). If we do that, it pretty much means getting storage for all my dad's stuff or taking it into our homes.

Last night we came up with what might be a decent solution. My 19 year old son is interested in renting the house at a going rate (although I'm considering throwing in a couple of utilities for him), keeping most furnishings as is, and doing a good bit of the cleaning as he goes along. He'd be willing to vacate if and when my dad is ever ready to come home, or just live with my dad. We could leave my dad's cars in the garage, sell my mom's knick knacks (which my dad wants us to do) as we go along, and this wouldn't have to be a full-time job for us.

I presented it to my sister, which I thought would be the biggest hurdle and she liked the idea. We'll talk to my dad, but I'm pretty sure he'd be on board with this. The more we think of this idea, the more we like it! We'd take the rent money and use what we need towards my dad's living expenses and put the rest in his savings account.

What do you think are some downsides to this that we'd need to watch out for? Anything taxwise in doing this? Legalities I'm not thinking of?

 

[happily single]

I see two downsides. First, you don't say how old your dad is, but is owning the house and/or renting it something that will disqualify him from any government programs like Medicaid?

Secondly, I know he's your son, but is he responsible enough to rent the house and upkeep? Is there any other sibling or close relative that may feel slighted if your son moves in as opposed to themselves?

 

[NHdisneylover]

In addition to the above (and again knowing he is your son and mothers always want to think only the best of their sons):

Will you and your sister really be able to handle kicking him out if he fails to pay rent or damages the property?

Will he possibly feel like he can get away with being late on rent or not paying the full amount because he is a relative?

Is your son the type to feel obligated to stay there even when he wants to move on because you and grandpa are relying on his rent for income?

Will you be able to force yourself to stay out of his private affairs if he is where you can watch over them so easily? (things like if he has overnight guests, parties, etc)?

 

[freckles and boo]

The biggest "con" I can think of is the liability your father would face as the homeowner if your son makes a bad decision. He may be responsible but he is also young.

 

[BELLE1109]

I think you should consult with the social worker at your Dad's facility and/or consult a elder attorney. My Gma is in a nursing home and we had to be very careful with assets and "spend down" to make full use of her benefits.

The home may need to be placed in a trust- but the social worker is my suggestion of a place to start

 

[MushyMushy]

I see two downsides. First, you don't say how old your dad is, but is owning the house and/or renting it something that will disqualify him from any government programs like Medicaid?

Secondly, I know he's your son, but is he responsible enough to rent the house and upkeep? Is there any other sibling or close relative that may feel slighted if your son moves in as opposed to themselves?

That is definitely something to look into with the Medicaid. I hadn't thought of it (see, glad I asked )

Nobody to feel slighted. My sister and I are pretty much agreement and he's the only adult grandson. Our biggest reason for thinking this is so great is that we can keep the house intact for my dad to return if that's a possibility. We'd like to keep him in assisted living at least through the winter.

In addition to the above (and again knowing he is your son and mothers always want to think only the best of their sons):

Will you and your sister really be able to handle kicking him out if he fails to pay rent or damages the property?

Will he possibly feel like he can get away with being late on rent or not paying the full amount because he is a relative?

Is your son the type to feel obligated to stay there even when he wants to move on because you and grandpa are relying on his rent for income?

Will you be able to force yourself to stay out of his private affairs if he is where you can watch over them so easily? (things like if he has overnight guests, parties, etc)?

Oh yeah I could definitely kick him out so much easier than I could if we rented to a family. He is always welcome back here at home, or if my dad moved back, I'm sure he could even choose to stay there. That's not a horrible idea.

Yes, it's a possibility he could decide to slide on the rent. So far, he's been pretty reliable financially. I've loaned him small amounts that he's been good about paying me back, but month to month rent? I don't know. When my husband and I discussed it last night, he had said, "If someone's going to be late or behind in rent, I'd rather cover my own son than a stranger." I agree, but only if that was a rare occurrence. But I just don't know. I don't think he'd feel obligated to stay.

Yes, I could stay out of his private affairs -- pretty much have been since he first moved out over a year ago. We're doing well with it. BUT, I'm not sure how much control I can give up over the house and its contents. We'll have to draw some definite boundaries there, because my sister and I will want 100% say in what happens there as far as contents and any changes that he'll want to make. We might want to go into the house more than my son would feel comfortable with.

The biggest "con" I can think of is the liability your father would face as the homeowner if your son makes a bad decision. He may be responsible but he is also young.

Would this liability be any different for a homeowner renting a house out to a college student? We live in a college town, so there are plenty of houses rented to kids his age. At any rate, something else to consider and look into!

I think you should consult with the social worker at your Dad's facility and/or consult a elder attorney. My Gma is in a nursing home and we had to be very careful with assets and "spend down" to make full use of her benefits.

The home may need to be placed in a trust- but the social worker is my suggestion of a place to start

Thanks! That's another good thing for us to look into.

 

[golfgal]

The biggest "con" I can think of is the liability your father would face as the homeowner if your son makes a bad decision. He may be responsible but he is also young.

This is not an issue at all, the son simply takes out adequate renter's insurance, which will give him a nice discount on his auto insurance as well.

OP, I don't see any real cons other then him not paying rent. Your dad isn't on Medicaid for the assisted living and the rent is covering his current expenses. If he does need to go on Medicaid for nursing home care he will have to sell his house anyway since he doesn't have a spouse and having your son renting out the place isn't going to change that at all. You will have to use the proceeds from the sale of the house to pay for his care before Medicaid will step in anyway.

If there is enough money from rent to cover his assisted living facility he could stay there indefinitely.

There are companies out there that will come in and clean out his place for you. I know of one in the Twin Cities, Rose's Daughters, if you look them up I know that they have connections to similar companies all over the country and they might be able to do some of this work for you too.

 

[Hannathy]

I think it is a great idea. I really don't see any cons that are that big of a deal as long as you know your son and "knowing" you from posting I know you wouldn't have a son that would not be trustworthy to his grandfathers house.

We did something similar with my Mom's house although it was just a good friend of my sister's. It really helped not having to do all the cleaning, sorting and fixing all at once. We didn't charge the person nearly what he would have had to pay elsewhere for a house but on the other hand he didn't get use of the attic or basement and things weren't fixed to the level you would demand in a normal rental.

I would be a bit careful with how much you discuss or reveal to the social worker at the place your Dad is at. I would try to get opinions elsewhere first and really it isn't any of their business who lives in your Dad's house if he is paying for his care. I'm not trying to cheat anyone, I don't do that, I just know sometimes simple solutions get complicated when too much bureaucracy and paper work gets in the way.

I say do it , I think it is a win-win for everyone.