Legal Question in Real Estate Law in Texas
Mortgage Info.
Sirs: My wife and I are in our 80's an know that we may have to go to assisted living. My daughter made a suggestion that we purchase a house under my G.I. bill, large enough for her family and us to live. That way she could take care of us. We have a Living Trust with our Daughter as executor and would also place the house we purchase into that trust. However, I have heard that if there was a Mortage on the house when we died that the V. A. could call in the balance of the loan, leaving my Daughters family without a place to live. What is the law on this situation?
2 Answers from Attorneys
Re: Mortgage Info.
You would need to read the loan documents to see if the loan could be called in the event of death. VA/VLB loans have very specific language, and may vary. In any event, I would suggest that you purchase either credit life insurance (to cover the cost of the mortgage) or purchase sufficient life insurance that would cover the house in the event of your death. (I would recommend this no matter what the loan docs said, it's just good planning.) If you are military, exmilitary or a military dependent, there are specialized insurance products available.
Re: Mortgage Info.
If you are a war-time veteran, you may have VA assisted living benefits that you would not be able to use if living with your daughter. Before transferring any asset or taking on an obligation, you should talk to a CPA. If there is a catastrophic illness and if you or your wife become eligible for Medicaid, you may be ineligible if you are living with other family members. On the loan, I have never seen the VA accelerate any loan upon death as long as it was being paid. However, it is best to check with the lender and read the Deed of Trust before committing to the loan. Finally...what if you hate living with your daughter and her family? Food for thought.
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