My mom's house was put into a living trust years ago. She has spent the last 2/12 years living with me. My sister and I are both on the deed for the house. Mom is on Medicare only. She is now in an assisted living facility but it is not skilled nursing. She is paying for this out of pocket. Hopefully this is short term and she will return to stay with me. If we sell her house will the money be taken in the future to pay for skilled nursing if that is needed?
Look at it this way. If the house is worth $130K and it generates $1350 a month in rents, that's a "dividend" of 1% per month. You can't get a better investment.
Then make an appointment with an elder law attorney to review all the above and come up with options that will best serve mom both financially and as she ages.
Realize that IF mom needs skilled nursing in the future, that means a NH and the costs will be somewhere from 5K - 15K a month. If she does not have the ability to private pay for this, then she can apply for Medicaid to pay. However her financials for the past 5 years can be reviewed to determine if there were any transfers of assets that could be a penalty for her. All legal on the property is within the local tax assessor / courthouse and dovetails to the state. So anything done now on the house will surface and be an issue for Medicaid.
One of the ?'s on this site is on keeping mom's / pa's house and what it means for Medicaid. Under Medicaid rules, they can (in most states) keep their home for the rest of their lifetime as an exempt asset for Medicaid. Now although this sounds ideal, someone will need to pay for all costs on the house for the rest of mom's life. All mom's income goes to the NH as her copay except for a tiny personal needs allowance. If it costs 10K annually on the house, can you pay this for the rest of mom's life. If it costs, 25K can you do this? If mom lives another 5 years, do you realistically have the income to pay or do whatever on the house for 5 years. If there is a mortgage, it probably is just not at all feasible. But it the costs are manageable for family to pay for years, and years, and possibly even more years, then it can make sense. It is like having a second or third home but without the benefit of ownership. For most, this is just not feasible, just like having a second home is just not feasible.
Now upon the elder's death this exempt asset becomes an asset of their estate and subject to MERP - Medicaid estate recovery. Which is a claim or lien on the property based on the deceased % of ownership. Now MERP has all sorts of exemptions, exclusions and hardships & all based on how your state's Medicaid program runs & your state's death / probate laws. If the heirs or the property can qualify for one or more of those and you can document & afford house costs, then it can make sense to keep the home. imho if you keep the house you really really need to have deep enough pockets to pay & a sense of humor to deal with the whatever's on the house for years & years.