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    • nelsongoat
    • By nelsongoat 5th Oct 17, 9:39 PM
    • 4Posts
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    nelsongoat
    Housing benefit capital
    • #1
    • 5th Oct 17, 9:39 PM
    Housing benefit capital 5th Oct 17 at 9:39 PM
    I've just had my new claim for housing benefit turned down. I live in a rented house but own another that I rent out. According to housing benefit calculations I have more than £25000 of equity on the property after the 10% deduction. As I put on the claim form, the house badly needs new windows and a new roof, which I was going to use the capital to pay for using a secured loan for £20000 over the next couple of months. If I now do this, will this reduce my available capital in the eyes of the housing benefit people and allow me to claim housing benefit? Or will they think that I'm deliberately spending the capital? Any advice appreciated, thanks.
Page 1
    • poppy12345
    • By poppy12345 5th Oct 17, 9:54 PM
    • 1,549 Posts
    • 1,376 Thanks
    poppy12345
    • #2
    • 5th Oct 17, 9:54 PM
    • #2
    • 5th Oct 17, 9:54 PM
    I'm not sure why you want to claim housing benefit when you own your own home and rent it out. Shouldn't you be living in your own house instead of renting it out?
    • nelsongoat
    • By nelsongoat 5th Oct 17, 9:58 PM
    • 4 Posts
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    nelsongoat
    • #3
    • 5th Oct 17, 9:58 PM
    • #3
    • 5th Oct 17, 9:58 PM
    I was working until last week and had no intention of claiming housing benefit. The house I rent out is in a different location to my home and not near my children's schools or my wife's work and it doesn't have enough bedrooms for my family to live in. To move into it would mean my wife leaving her job and my children moving schools. It doesn't seem the right thing to do at the moment as it would make us worse off. Also, I've rented it the house out and I can't just kick the tenants out during their tenancy.
    • fishybusiness
    • By fishybusiness 5th Oct 17, 10:02 PM
    • 1,119 Posts
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    fishybusiness
    • #4
    • 5th Oct 17, 10:02 PM
    • #4
    • 5th Oct 17, 10:02 PM
    Sell it, needs must unfortunately.
    • nelsongoat
    • By nelsongoat 5th Oct 17, 10:06 PM
    • 4 Posts
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    nelsongoat
    • #5
    • 5th Oct 17, 10:06 PM
    • #5
    • 5th Oct 17, 10:06 PM
    That's the longer term plan if I don't find another job. If I sell it now, it's likely to take a couple of months before I get the money, also it's likely to sell for much less than the councils valuation as it needs windows and roof replacing. I expect I'll end up with less than £5000 and it will take several months before I get the money. It doesn't help me now.
    • poppy12345
    • By poppy12345 5th Oct 17, 10:07 PM
    • 1,549 Posts
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    poppy12345
    • #6
    • 5th Oct 17, 10:07 PM
    • #6
    • 5th Oct 17, 10:07 PM
    I've just had my new claim for housing benefit turned down. I live in a rented house but own another that I rent out. According to housing benefit calculations I have more than £25000 of equity on the property after the 10% deduction. As I put on the claim form, the house badly needs new windows and a new roof, which I was going to use the capital to pay for using a secured loan for £20000 over the next couple of months. If I now do this, will this reduce my available capital in the eyes of the housing benefit people and allow me to claim housing benefit? Or will they think that I'm deliberately spending the capital? Any advice appreciated, thanks.
    Originally posted by nelsongoat
    That £20,000 loan would wipe out your housing benefit claim if claiming was possible. It would most likely be classed as deprivation of capital if you spent it on repairs...
    • nelsongoat
    • By nelsongoat 5th Oct 17, 10:24 PM
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    nelsongoat
    • #7
    • 5th Oct 17, 10:24 PM
    • #7
    • 5th Oct 17, 10:24 PM
    So, using capital to spend on essential repairs, declared on the claim form is still likely to be treated as deprivation of capital? I still will go ahead anyway unless an estate agent says I'm better selling as it is.
    • IAmWales
    • By IAmWales 5th Oct 17, 10:36 PM
    • 1,491 Posts
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    IAmWales
    • #8
    • 5th Oct 17, 10:36 PM
    • #8
    • 5th Oct 17, 10:36 PM
    So, using capital to spend on essential repairs, declared on the claim form is still likely to be treated as deprivation of capital? I still will go ahead anyway unless an estate agent says I'm better selling as it is.
    Originally posted by nelsongoat
    It's not an essential repair on your home though, which may be acceptable. It's a loan to add value to a capital asset, an investment.

    If your wife is working how much HB would you be entitled to? Are you applying for any work you can, even if it's just a stop gap? All the main retailers are recruiting for Christmas, as are Royal Mail. As long as you're making up for the shortfall in HB you'll be better off than selling the property.
    • poppy12345
    • By poppy12345 5th Oct 17, 10:38 PM
    • 1,549 Posts
    • 1,376 Thanks
    poppy12345
    • #9
    • 5th Oct 17, 10:38 PM
    • #9
    • 5th Oct 17, 10:38 PM
    So, using capital to spend on essential repairs, declared on the claim form is still likely to be treated as deprivation of capital? I still will go ahead anyway unless an estate agent says I'm better selling as it is.
    Originally posted by nelsongoat
    Yes! you're planning on a loan for £20,000 to spend on your house that you rent, then you want to claim housing benefit for another? Deprivation of capital for sure!
    • Housing Benefit Officer
    • By Housing Benefit Officer 6th Oct 17, 5:02 AM
    • 2,387 Posts
    • 4,244 Thanks
    Housing Benefit Officer
    I will dig out the legislation tonight or at the weekend...
    These are my own views and you should seek advice from your local Benefits Department or CAB.
    • FBaby
    • By FBaby 6th Oct 17, 5:39 AM
    • 15,943 Posts
    • 39,733 Thanks
    FBaby
    As I put on the claim form, the house badly needs new windows and a new roof, which I was going to use the capital to pay for using a secured loan for £20000 over the next couple of months.
    Do lenders give loans of that value, even if secure to the unemployed?
    • tomtom256
    • By tomtom256 6th Oct 17, 7:53 AM
    • 876 Posts
    • 1,607 Thanks
    tomtom256
    So are you're current tenants living in substandard accommodation then?
    • poppasmurf_bewdley
    • By poppasmurf_bewdley 6th Oct 17, 11:34 AM
    • 5,011 Posts
    • 5,155 Thanks
    poppasmurf_bewdley
    Even if you had no capital at all, owning a house, either in this country or abroad, would preclude you from receiving housing benefit or housing allowance.
    "Annual income twenty pounds, annual expenditure nineteen pounds nineteen and six, result happiness. Annual income twenty pounds, annual expenditure twenty pounds nought and six, result misery." Mr Wilkins Micawber in David Copperfield by Charles Dickens.
    • paddedjohn
    • By paddedjohn 6th Oct 17, 7:21 PM
    • 7,042 Posts
    • 7,717 Thanks
    paddedjohn
    Which bank will give you a £20k loan while unemployed?
    Be Alert..........Britain needs lerts.
    • Housing Benefit Officer
    • By Housing Benefit Officer 6th Oct 17, 7:45 PM
    • 2,387 Posts
    • 4,244 Thanks
    Housing Benefit Officer
    I've just had my new claim for housing benefit turned down. I live in a rented house but own another that I rent out. According to housing benefit calculations I have more than £25000 of equity on the property after the 10% deduction. As I put on the claim form, the house badly needs new windows and a new roof, which I was going to use the capital to pay for using a secured loan for £20000 over the next couple of months. If I now do this, will this reduce my available capital in the eyes of the housing benefit people and allow me to claim housing benefit? Or will they think that I'm deliberately spending the capital? Any advice appreciated, thanks.
    Originally posted by nelsongoat
    Double edged sword here.

    The valuation of your property is based on its current condition.

    If you spend £20k on your property and put yourself a further £20k in debt - the value of your property might increase by £20k with the fancy new windows and roof.

    There is nothing stopping you carrying out these repairs. You are not a benefit claimant.

    As for deprivation of capital and reducing the value of your asset we would have to look at the motivation behind this. Did you do this to get Housing Benefit as you had an understanding of Housing Benefit capital rules or was this spent on essential repairs?

    Separately to the value of the property we would also look at the income you receive from renting it out - Rent received - minus mortgage - and expenses (i.e. landlord insurance etc) anything left over is treated as income.

    If the property was occupied by a disabled pensioner relative then the property value would be disregarded in full.
    These are my own views and you should seek advice from your local Benefits Department or CAB.
    • Housing Benefit Officer
    • By Housing Benefit Officer 6th Oct 17, 7:47 PM
    • 2,387 Posts
    • 4,244 Thanks
    Housing Benefit Officer
    Even if you had no capital at all, owning a house, either in this country or abroad, would preclude you from receiving housing benefit or housing allowance.
    Originally posted by poppasmurf_bewdley
    Not necessarily....
    These are my own views and you should seek advice from your local Benefits Department or CAB.
    • Bananas123
    • By Bananas123 7th Oct 17, 2:50 AM
    • 293 Posts
    • 123 Thanks
    Bananas123
    timing is a bit dodgy....

    you have to show it was not deprivation of capital, you can only do this with evidence,

    if the roof is leaking or your tenants have been complaining then i would (as a non-practicing non-law person) would consider that as adequate etc, in court (as in tribunal if they say no, and you were going to).

    --------------

    but if the roof and windows are keeping the weather out i.e. "working" then it's going to very much seem like you are trying to deprive to obtain benefits.

    ("can't pimp your house out and then party off benefits"... pretty obvious)
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