jsa & mortgage savings.

At_the_edge.

Hi. We have an interest only mortgage & instead of taking out an endowment we have a shares ISA which (hopefully) will help pay it off eventually.
Will this be counted as capital in relation to claiming for jobseekers allowance (income based) or will part or all of it be disregarded ? If we used it now to pay off a chunk of the mortgage would that be treated as deprivation of capital in order to receive benefits. Have posed this question to the jobseekers helpline but just get told that the "decision" maker would need to look at all details of any claim before deciding.....
Would appreciate any help on this.

karenx

Well its savings that you could be using to live on instead of keeping it in a savings account or putting it towards the mortgage.......

exil

Yes, it will very likely be counted as capital. See this

http://www.bracknell-forest.gov.uk/living/liv-benefits-and-advice/liv-how-much-benefit-will-i-get/liv-capital-and-saving.htm

though they don't know the difference between "effect" and "affect"!

leemack

it will be counted as capital but you are not classed as depriving yourself of capital if you use the capital to reduce or pay off a debt as you would be if you reduced your outstanding mortgage. But the dwp will want to see documentation that that's what you've done.

tr82

I don't see why an ISA mortgage should be treated any differently than, say, an endowment mortgage. Both are long term saving plans, both rely on disciplined saving, both use interest only mortgages. So I think it'd be unfair to treat an ISA mortgage differently.

Provided the ISA is clearly linked to the interest only mortgage (and you'll have documentation to that effect) I don't think you'll have a problem. The value of the ISA should be wholly disregarded when it comes to capital.

leemack

if its officially linked that would be different, like you say tr82 the dwp wouldn't expect a person to cash in their endowment rather than be on benefits.