Helping mum...

bris

There is more to this than just the LHA officer telling you about how it works.
Once the claim goes in a senior officer will look at the claim in detail. In the wash the details of how you have bought the house for half it's value, to claim LHA for the current owner, who is your mother will come out. There is a very high rate of probability that this will be seen as a contrived tenancy to take advantage of the LHA, which lets be honest, it is.
Before you go ahead you should seek a meeting with a LHA officer and tell him exactly what you plan to do and try and get a firm answer from him. If the idea all hinges on the LHA this would save you the trouble if it fails.

tbs624

mikmo wrote: »

Ohh I’ve tried that angle! There’s no moving her!

Don’t worry she’s not too hard off, certainly won’t be once I’m paying the mortgage anyway!

..except that it isn't you who will be funding the mortgage in it's entirety is it? It's the LHA payments because you will be your mother's & brother's LL.

Housing Benefit give her (including covering her rates) £300 per month but things are still tight.

then

Two motivations:

• Housing Benefit in a rental for her and a dependant is c. £450 per month. So more support from them.
• I could take out say £120k of mortgage and give her some cash to clear her credit card debts etc.

This sounds to me to be very much a contrived tenancy: you and your mother want the LHA to pay more towards the costs of this property than they currently do and then in one of your posts you refer to your mother using money from you "to travel" ?

This is where the whole system is wrong IMO- if your mother cannot afford to fund the larger than necessary house,and/or clear her cc debts, then she should sell up and downsize.

Have you fully thought through your own involvement?

You would need a buy to let mortgage and this is based on your potential rental income. Some lenders specifically exclude lets to family members and/or those who are in receipt of certain benefits.

Have you allowed for the costs of LL gas safety checks/certs, EPC, a contingency fund for repairs, LL insurance policies and so on?

emmell

What about the £30,000 difference between what your mother owes (90k) and what you are going to pay (120k). If this money is going to your mother I doubt she would be entitled to housing benefit, or can you have unlimited funds and still claim (probably, in this country).
ML.

bris

emmell wrote: »

What about the £30,000 difference between what your mother owes (90k) and what you are going to pay (120k). If this money is going to your mother I doubt she would be entitled to housing benefit, or can you have unlimited funds and still claim (probably, in this country).
ML.

Thats a good point, I didn't pick up on the 30k. With over 16k in the bank your mother is not going to get any benifits never mind LHA. Your brother might though.

cheepskate_2

mikmo wrote: »

Ohh I’ve tried that angle! There’s no moving her!

Don’t worry she’s not too hard off, certainly won’t be once I’m paying for the mortgage anyway!

should read

Don’t worry she’s not too hard off, certainly won’t be once[STRIKE] I’m[/STRIKE]THE TAXPAYER, (I.E us!!!!!) are paying for the the mortgage anyway

mikmo

tbs624 wrote: »

..except that it isn't you who will be funding the mortgage in it's entirety is it? It's the LHA payments because you will be your mother's & brother's LL.

I think it's key to note that the LHA payments claimed would only be what she'd be entitled to if she and my dependent brother moved to a suitable 2 bed house in the area.

There is no additional burden on the tax payer as suggested by some of the inflamed comments of others. As she can't afford the mortgage she will be moving to LHA and either renting from a private land lord... or renting the house from me (with the same level of LHA support) and me covering the additonal cost of the current house vs a smaller 2 bed.

tbs624 wrote: »

You would need a buy to let mortgage and this is based on your potential rental income. Some lenders specifically exclude lets to family members and/or those who are in receipt of certain benefits.

Have you allowed for the costs of LL gas safety checks/certs, EPC, a contingency fund for repairs, LL insurance policies and so on

I'm not 100% certain I'll require a BTL mortgage, again something to be discussed with LHA. I have factored in the additional costs. This isn't a profit making exercise for me so not hugely relevant.

mikmo

bris wrote: »

Thats a good point, I didn't pick up on the 30k. With over 16k in the bank your mother is not going to get any benifits never mind LHA. Your brother might though.

This will be used to pay off other debts and make some vital repairs to the house.

casper_g

mikmo wrote: »

I'm not 100% certain I'll require a BTL mortgage, again something to be discussed with LHA. I have factored in the additional costs.

Surely it's not the LHA people who will require that you have a BTL mortgage, but your mortgage provider?

silvercar

casper_g wrote: »

Surely it's not the LHA people who will require that you have a BTL mortgage, but your mortgage provider?

Some lenders will be quite happy with someone obtaining a mortgage to house a parent.

silvercar

Your benefit problems are that

(a) the tenancy looks contrived, particularly if you are letting it at 2-bed rates for a house where the market rent must be a lot higher and

(b) if your mother has sold below market value it could be considered deprivation of assets ie she has sold cheap to deprive herself of the full value of the property in order to be able to claim LHA. If she had sold at full value and rented elsewhere she would have enough money in the bank to be able to pay her own rent rather than be funded by benefit ie the tax payer.