Question on housing benefit and don't live at property

Notmyrealname

banks4u wrote: »

Situation is mum will be staying here alone, she has no interest in the property. I read somewhere if the owner of the house is not residing in here my mum would get housing benefit. I could quite easily rent this house and mum could find a one bed flat that she can rent and the council would give Hb. Had that confirmed by them.

If you rent to your mum you would have to prove it is not a contrived tenancy for her to get HB - i.e it is not a tenancy solely created to get HB to pay the mortgage. Getting HB with a close relative as a landlord is nigh on impossible.

You would need to get permission to rent from the mortgage company or a commercial mortgage, LL insurance, have an annual gas safety check etc etc etc.

karenx

You will also have to charge her the going rate for that type of property. So she may not be entitled to much and will have to make up the shortfall herself. And you will also have to be prepared to evict her if she doesnt pay.

BigAunty

banks4u wrote: »

Situation is mum will be staying here alone, she has no interest in the property. I read somewhere if the owner of the house is not residing in here my mum would get housing benefit. .

Yes, but only if its not considered a contrived tenancy, set up to exploit the housing benefit system. For example, one way that it is considered to be contrived is if no rent is charged when a person is in employment but rent is charged when they are on benefits.

So does your mum currently live there now (and if so, does she pay you rent)? because if she's not paying rent or much rent at all, I wonder if the council will reject the HB claim as contrived if you expect to receive hundreds of pounds in HB for her when there was little or no liability to pay before.

Also, if the HB claim is accepted, she will be entitled only to a 1 bedroom rate of Local Housing Allowance despite the size of the property - is this even going to cover your mortgage payments? You will be responsible, as a landlord, for paying for repairs and maintenance costs, getting landlord insurance (more expensive), annual gas safety check and getting permission from the lender to have tenants.

See the Direct Gov website to identify the LHA rate.

Google 'Contrived tenancy' to understand what the council look for in establishing this. Speak to your local council about your plans to see if they consider it contrived. My understanding is that lettings between relatives are subject to extra scrutiny by council staff.

fluffymovie

banks4u wrote: »

Oh yeh I don't want hb, but would I mum and bro get it. bro is lookin for a job. He use to pay 880 a month for rent but then he lost his job.

If your mum will live there alone, why did you mention your brother?

BigAunty

banks4u wrote: »

...Mum is on pension credits and bro is lookin for a job. He use to pay 880 a month for rent but then he lost his job.

£880 is a huge sum to find each week for part ownership of a property - just how high is the mortgage?! That's just over £200 a week, more than someone can net by working full time on the minimum wage. Are you having to match this sum yourself, too, or is he paying all of it because you don't live there anymore, for example?

And it's not 'rent' if he's an owner, its paying the mortgage. Only tenants pay rent so this is why housing benefit is out of the question for him if he occupies the property (and he'll probably have trouble claiming it elsewhere due to his capital).

Where is he living at the moment? As a joint owner, he has the right to occupation so he can simply just turn up and move in anytime he likes.

Housing benefit may also be out of the question for your mother, too, if the council believe you are just setting up the tenancy to get housing benefit.