When you inherit a house, can you claim housing benefits??

Dunroamin

Why don't your brothers get a couple of people in to share the house? Their rent should cover the mortgage with some over to be paid to you and your sister.

Pricivius

It may help to look at it this way:

Your late mum owes the bank £30,000. This is a debt that the bank has secured against the property which is jointly owned by you and your three siblings. As Administrator, you must pay off this debt. Somehow. The bank are entitled to their money. One option would be to offer to pay back the £30,000 over time, with the debt secured on the property i.e. take out your own mortgage for the sum owed. As it would seem you can't do this, you need to find another way to pay back the £30,000.

Whilst selling the family home is upsetting, you are each set to gain a significant lump sum from the hard work and sacrifice of your parents, and it's far more use to you all than a house that two of you don't want to live in and the other two of you will probably only live in for a short while. How long would you and your sister be happy for your inheritance to be tied up in the family home for? I would suggest it makes sense for all of you to sell it and use the money towards your own homes which suit your needs, although I appreciate this is a difficult time.

Definitely get some advice on handling you mum's estate as you need to be sure all debts have been covered before you hand out any sums.

Janep

What about your brothers getting part time evening work around their studies and taking out a joint mortgage

xylophone

It might be an idea to approach your local council and explain that while you and your siblings have been left a house, nobody is in a position to take over the mortgage so that the house must be sold - after expenses/fees are met and the mortgage repaid the boys will have £40000 (app) each, but would not be in a position to afford a mortgage or private rental.

In these circumstances, I am wondering whether the boys/ your sister as guardian might be eligible for social housing.

You might also need to check the position around any child benefit that is being paid and on any further help to which the boys might be entitled.

Have you seen a benefits adviser at CAB?

PippaGirl_2

Firstly OP, I'm really sorry for your loss and for the fact that you are having to deal with all this at such a sad time.

Secondly, the most important thing here is that the mortgage company will want that mortgage paid off asap (when they say you can pay it temporarily, they mean temporarily while you make arrangements to pay it off asap) and if not will place legal claims on the equity by repossessing the house if necessary. They won't accept you continuing to pay the mortgage yourselves or renting it out to pay it. So talking of those options is utterly pointless.
Therefore you either need to find a way to come up with the money to pay off the mortgage, or you need to sell the property to pay off the mortgage. As administrator you can place your brothers part of the money in trust for them, however this is taken in to account by the DWP even if the trust means it is not accessible to them so will affect what benefits they can claim.
I do see what you mean that the likely result is they will be living off their inheritance for the next few years and then it will be gone and that is sad but unless there is a way of paying off that mortgage and keeping the house I don't see there is any other way.

Dunroamin

PippaGirl wrote: »

They won't accept you continuing to pay the mortgage yourselves or renting it out to pay it. So talking of those options is utterly pointless.
.

I think that's a very sweeping statement.

We have no way of knowing whether this is this is the case; the lender may be perfectly happy as long as payments are being made and may also be prepared to change the mortgage to buy to let.

There's a small amount owing with a large amount of equity and, if arrears aren't built up, there may be many options open.

BigAunty

The Shelter website has excellent info for those who are struggling to pay the mortgage. Of course, it is pitched at home owners while you are the administrator so there are complexities there but does outline some future options to prevent repossession.

Also, they have a section on homelessness which outlines a local councils obligation to assist those who have no security of tenure past the next 28 days (the basic definition of homelessness) so you can see what happens if your younger brothers approach the council if their home is repossessed or sold. Perhaps you should speak to them now, ahead of a future crisis, to get pointers on their options.

PippaGirl_2

It may be a sweeping statement but I was quoting the legislation on mortgages which is quite a sweeping thing.

Dunroamin

PippaGirl wrote: »

It may be a sweeping statement but I was quoting the legislation on mortgages which is quite a sweeping thing.

What legislation says that you can't take out a BTL mortgage on a property you own?

Lovelyjoolz

Dunroamin wrote: »

What legislation says that you can't take out a BTL mortgage on a property you own?

That's the point. The OP doesn't own it. She will own 25% of it when probate has been completed.

No Lender will lend £30k against a £47.5k share of a house. BTL or not.