Selling my home whilst on IS

princessdon

So how do DM view it. Is for Eg OP expected to show value of homes she is potentially looking at, expected salary, prove affordability, prove applying for jobs etc, or do they take her word for it that she is looking to use as a deposit.

mikey_bach

I suppose if she had the money to buy a home out right then they would have to give them the twenty six weeks to find a new property.
Some downsize slightly or move to a more suitable property if they have disabilities....

But they would need a lot more information if it was a small amount say 30k to how the customer intended to raise the rest say if they were
stay on I.S this would not be possible of course
And then they may then decide not to give the 26 weeks disregard and nil the claim
Each case is looked at on its own merits by the DM
And the customer can appeal if they dont agree with the decision

shop-to-drop

Can you not wait to sell until you are in a position to get a new mortgage?

missapril75

princessdon wrote: »

Logically any mortgage will require a minimum (and that is generous following a period of benefit claims) 3 months or end of probation.

Plus can they realistically buy

Good questions. Given the further information since, it would certainly be difficult.

So can she realistically say "the capital is earmarked for a new home" without any come back and 100% acceptance?

There's a thread in the last couple of days where parents mortgaged their own home to help buy a home for one of their kids. Some sort of arrangement along those lines (with OP paying the deposit) would be possible.

At what point do they say - When is the purchase?

When the 26 week date approaches, usually. (I have done these decisions myself a few times.)

Are you saying I could sell my home (keep the £200K capital) and claim HB for 6 mos plus "in case I buy in the future"?

Not "in case," no. One would need to be satisfied it was genuine. Just as in a case where one is disregarding the value of a house pending a sale and one asks for proof it is for sale, one might want proof of intent to buy.


Incidentally, 20k could be enough for a mobile home or similar. That's all it needs to be. She could trade up later.

FBaby

Isn't it a bit of a catch 22 then? If you are not currently working, with no expectation of starting a particular job soon, how are you going to convince that you really do intend on buying a property within 26 weeks? You would need to look for a job, go to interview, be offered the job after references are checked out, and then convince a mortgage lender to offer a mortgage, find the property etc... Are mortgage lenders happy to support an application from someone who has just started a job? What about probation period?

BigAunty

Mr_Mcgregors_wife wrote: »

... The LPA told me that due to my current mortgage being so high and the fact that my children are under school age it would be foolish of me to get a job as I would risk my home being repossessed if I fell behind with the payments and I would be better off waiting until they are at school.

What is an LPA?

Is it actually the case that this current property is too expensive for you? What is your earning capability versus mortgage? Are you burdened with child care availability/cost - is this is why you don't think you can work at the moment? Can you afford to stay there until your youngest turns 5, for example, and then seek work and then sell up?

Are you aware of the support for mortgage interest scheme (see info on Direct Gov) that helps pay the mortgage interest for people on IS and other benefits?

See the Shelter website for info on the various options and advice for struggling homeowners, including the SMI scheme and other tips, such as negotiating with the mortgage lender and so forth.

You will lose a lot of that 20k to stamp duty and legal fees on your next purchase.

Mr_Mcgregors_wife wrote: »

...

To a previous poster, I get IS, CTC, CB, CT and some interest paid on my mortgage.

I am not aware that there is protection available for someone on benefits who receives a lump sum from the sale of the property to buy the next one so do check that out thoroughly. One thing discussed in the move to the Universal Credit system is how much a household can have in savings before it affects their UC, if there is a way of ring-fencing savings for deposits on property and the govt were v.cool about it.

With capital that is counted for means tested benefits, your IS, council tax and housing benefit will be either partly or fully wiped out (sums over 6k reduce, sums over 16k rule out). Your child tax credit is only affected by interest over £300 which is classed as income (do verify this). Your child benefit continues. Use the Turn2us online benefit checker to model the effect of the lump sum.

mikey_bach

Usually the twenty six rules apply to people who downsize or side shift.
They sell the family home and buy a smaller one etc.
Any money left over from the sale of the family home and the purchase of the new home would be subject to normal capital rules.

If the OP did sell the house and said she was going to buy another and only had enough for a deposit say, the DM would look at the case in great detail and OP would have to provide proof on how she was going to proceed with the purchase of a new property before the disregard could be given

Marisco

mikey_bach wrote: »

Usually the twenty six rules apply to people who downsize or side shift.
They sell the family home and buy a smaller one etc.
Any money left over from the sale of the family home and the purchase of the new home would be subject to normal capital rules.

If the OP did sell the house and said she was going to buy another and only had enough for a deposit say, the DM would look at the case in great detail and OP would have to provide proof on how she was going to proceed with the purchase of a new property before the disregard could be given

But how would she do this? She said she is going to rent and look for a job, but it could take months to get a job that pays enough to get a mortgage. And by that time her 26 weeks could be up, so what happens then? Would it not be better to stay put, look for a job, get a job, then sell and buy something else? As well as all the benefits, she should also get child maintenance, so unless the mortgage is huge, there might be a way of swinging it for a while, till she gets on her feet a bit.

Dognobs

Who will pay for your rent? Will that be us?

FBaby

Why its your ex signing the house over to you? Wouldn't it better if he continued to pay his share of the mortgage until the children are at school and you get a job? You could then agree on the share of the sale and you could put this towards the deposit?