Estate Planning Bits

Estate planning with Alzheimer’s disease – start ASAP

The University of Alabama at Birmingham (UAB) released new research, which was published in the American Journal of Geriatric Psychiatry, providing that patients with mild Alzheimer’s disease (AD) have a dramatic decline in their ability to make financial decisions over a one-year period. The findings of the report strongly suggest that caregivers, health care providers, and other family members should seek estate planning options and fraud prevention measures immediately on behalf of those suffering with Alzheimer’s disease.

Dementia is a general term for the loss of memory, decision-making and other intellectual abilities serious enough to interfere with daily life. Alzheimer’s disease is the most common form of dementia.

The recent UAB report provides that “[a]fter just one year, the mild AD group had dropped to 70 percent of the financial capacity demonstrated by the healthy older adult group.” As such, the sooner estate planning can begin, the more the person with Alzheimer’s may be able to participate. Daniel Marson, director of the UAB Alzheimer’s Disease Center in the Department of Neurology, and the study’s leading author, said that “[t]he findings underscore the importance, at the time of diagnosis, of patients with mild AD and their families promptly pursuing financial planning and transfer of financial responsibilities.”

Therefore, a person diagnosed with Alzheimer’s should run, not walk, to an experienced estate planning attorney to discuss key issues such as options for health care decision-making, options for managing the person’s property and possible coverage of long-term care services, including what is provided by Medicare and other health insurance and government assistance programs. And, to locate the Alzheimer’s Association office nearest you, call 1.800.677.1116 for additional information and resources.

By: Todd C. Ratner, Esq.

Update on reverse mortgages

Several years ago, a new product was introduced called the reverse mortgage. This allows a senior to access the equity in their home without ever having to pay it back, under most circumstances. Until this product was introduced, a person could only get a basic conventional mortgage or a home equity loan, but these required payback during one’s lifetime.

A reverse mortgage allows funds to be withdrawn when needed in either a lump sum, over time, or in amounts that are fixed over the course of time until the limit of withdrawals has been reached. In any event, a person need not sell their home to make the payments to the bank unless they leave the home.

There are eligibility rules for reverse mortgages, such as the person must be at least 62 years old and must occupy the home as their principal residence for the majority of the year. Therefore, a second home, which is not the principal residence, would not qualify for the reverse mortgage.

Recently, a new law was passed that allows for greater limits to be accessed for the home valuation to determine what percent of the house may be utilized for liquid cash for the mortgage. These new limits are beneficial in most cases, but should not be used for everyone in all circumstances. Each person must be advised specifically as to the pros and cons of obtaining these reverse mortgages, since the fees are often significant when obtaining them, although many times, the fees are paid from the mortgage and not from funds held by the individual homeowner themselves.

In addition, although you may see recognizable television or movie stars promoting these mortgages in a TV ad, a person must be counseled privately before obtaining a reverse mortgage, so that they will totally understand the nature of the product and the costs involved. Many times, if a person is not 100% competent, their power of attorney or guardian may also be able to access the funds through the reverse mortgage, sometimes only after court approval.

Nevertheless, these types of mortgages are not credit based, and therefore, income and credit history are not necessary for the person to obtain the mortgage. The criteria would be solely home ownership, age, and capacity to contract to obtain the mortgage. However, a reverse mortgage is not right for everybody. Specific and timely advice should be obtained before taking out a reverse mortgage, since once it is obtained, it remains as an outstanding debt and liability. If the house is sold, it will have to be paid off. Not every financial institution provides for reverse mortgages, and one should “shop around” to ensure that they are getting the best deal on interest rate, fees, and accessibility before obtaining this special type of mortgage.

By: Hyman G. Darling, Esq.

Green burials – what are they and what are their advantages?

Lately, there has been a movement to educate consumers of alternative burials. One such movement asks consumers to consider a “green burial.” A green burial is aptly named because it aims to provide ecological soundness.

A conventional burial in the United States typically involves embalming, a casket made of hardwood or steel, and a concrete grave liner or vault. A green burial in contrast, usually entails a biodegradable wrapper and no embalming. The grave is typically marked by a flat memorial stone or other grave marker such as a tree or other planting. Computer mapping such as a GPS is often used to locate the grave. Advocates of a green burial argue that this technique conserves resources, protects groundwater and returns bodily nutrients back to the land. The cost of green burials is significantly lower than conventional burials. One estimate puts the cost of green burial at under $3,000.00 whereas the average funeral nationwide costs approximately $6,500.00.

The proper document to provide your burial instructions, which may include a conventional burial, cremation or green burial, is the Health Care Proxy. An experienced estate planning and elder law attorney can prepare this document accordingly so that your burial instructions are carried out properly.



By: Todd C. Ratner, Esq.

Victory for the Down Syndrome community

In late September of 2008, after approximately three years of advocacy, a victory occurred when the Senate and House passed a unanimous law called the Prenatally and Postnatally Diagnosed Conditions Awareness Act. This law will ensure that pregnant women who receive a positive prenatal test result and parents who receive the postnatal diagnosis will be more likely to receive up to date scientific information about life expectancy, clinical course, intellectual and functional development, and prenatal and postnatal treatment options.

Within the Act, there are provisions that offer referrals to support services such as hotlines, websites, adoption registries, and parent support networks and programs. In the past, much of the information provided was outdated and inaccurate. Many treatment options and opportunities were not provided, and there were decades-old stereotypes still persisting.

Under this new law, families and society will receive knowledge and information about individuals with Down Syndrome. This is a major victory, as it is hardly a routine occurrence with unanimous consent.

Senators Edward Kennedy (D-MA) and Sam Brownback (R-KS) were the original co-sponsors of the Bill, and they led this through the Congress for the ultimate benefit of all families and their children. It is hopeful that many of the myths and stereotypes will be dismissed, and that the future for these families and people will be better served. If you need for further information please contact the National Down Syndrome Society or the National Down Syndrome Congress.


By: Hyman G. Darling, Esq.