Legal Question in Wills and Trusts in California

The Will would only be valid if she was of sound mind when she prepared and signed it; if she has been diagnosed as having dementia, then they may have the burden to show she was of sound mind when she read and signed the Will.

As to the "loan", they have to show that it was a loan and when it was to be paid back. Since it has been at least 12 years and nothing has been paid and she never requested any payment, and you would testify it was a gift, a court would more than likely find it was either a gift or a loan that you have the option of repaying whenever you want. Line up what evidence you have to support your position, get any witnesses to prepare Declarations under penalty of perjury for you to use in the future, visit your mother and when she is lucid ask her about the loan and if she agrees it was a gift get two people to witness her Declaration to that effect, spelling out everything that happened. Get a copy of her Will to see if it is acceptable to you. See if you can reduce her expenses without reducing the quality of her life style.