If House is Placed in Irrevocable Trust, will Line of Credit be Countable by Medicaid?
If property has a line of credit from a reverse mortgage available before being placed in an irrevocable trust, can Medicaid consider the line of credit as a countable asset while in the trust?
No, but it’s probably an unworkable strategy for a couple of reasons. First, transferring the house to the trust probably violates the terms of the reverse mortgage, possibly triggering the repayment of the mortgage. Second, for the trust to work in terms of Medicaid protection, the reverse mortgage funds must be made inaccessible to the homeowner, which would seem to contradict the purpose of getting the reverse mortgage in the first place.