Only my maiden name on mortgage with NE but want to move out into rented house.

booMummy

[FONT=&quot]We bought our fairly run down house in a cheap area believing the area was improving and that we could make a modest profit and then move up the property ladder. We have had a lot of work done on the house but there is still some important stuff to do. Unfortunately due to redundancy a few years back, my husbands extended period of unemployment and an increase of crime in the area and boarded up houses we have actually found ourselves in negative equity of around 10k and no savings. We are desperate to move out of the area in order for us and the children to feels safe. I have suffered severe depression and our son has also been afraid of the things he has seen and heard through the windows of his bedroom. We really are desperate to move, I have felt this way for a few years now and feel I need to do something now before the depression potentially returns again leaving me feeling incapable of even doing the housework never mind the mammoth task of sorting out finances and moving.

The plan was for me and the children to move out into a rented property since I don't feel safe staying here without my husband and really don't want to be here anyway. My husband was going to stay in the house while it was being sold to ensure it isn't broken into or the windows smashed due to being vacant (very common here).

The house is in my maiden name only. I bought the house a couple of months before we were married but we have always lived in it together. We were informed my husbands’ seasonal employment at the time would be seen as a liability to the mortgage company (Northern Rock) so he was not included on it. Due to arrears and claiming Interest Only mortgage benefit help due to unemployment we were then changed to Nram. We have been back on the repayment plan for some time now and the arrears will be cleared by the end of March.

We have 2 young children, my husband brings in a modest income, we already live very frugally. I work from home running my own business (with no real income) so that I can stay home full time with our children (a massively important lifestyle choice for us). I am considering closing the business but if I’m living on my own then I feel I’ll need it to claim working tax credits and be able to stay home with my young children.

So here is the main problem. If I move out, my husband won't be able to afford to pay the mortgage whilst it is on the market to prevent the mortgage company chasing me for the full amount and I need to claim housing benefit to be able to afford the rent on another house.

We have considered renting out this house so we don't need to claim any kind of benefits but of course this is not a light decision. We have considered handing the keys back to Nram but this will mean I have to go bancrupt and can no longer run my business and it looks as if there are also many other negatives to it. Is it really that bad? We have considered my husband staying in the house and getting a lodger to make up the difference in the mortgage but we don't know if that’s possible since his name is not on the mortgage and Nram have stated my name must always stay on the mortgage. Can I claim housing benefit in this situation? Is it possible to put the house on the market, live in a rented house and claim housing benefit? Is there a 26wk allowance or something?

We really don't care about being on the property ladder anymore, we just want to be somewhere we feel happy and safe as quick as possible. We are happy to do it with a short or long term separation since there are other personal benefits of that to us all anyway.

I have been offered a private rented house by a friend, it is available now in a safe place and I could afford it on my own provided I had housing benefit. As a couple we can easily afford it with husbands wages and tax credits. We would technically have enough left over to pay the mortgage on the house I own too but not the council tax and water rates etc. If we could rent out the house and charge 400-450pcm it would leave us over 100pm to put away for any possible repairs on the house. That’s if a Buy to Let was granted by Nram (I hear not very likely) and the repayments stayed the same.

Sorry for the ramble. My first time posting and I'm so confused about it all. Any helpful advice would be gratefully received. [/FONT]

BigAunty

The Shelter website has good info for homeowners struggling with their mortgage.

Are you actually splitting up with your husband or are you arranging to separate in order to qualify for HB at a new property?

The benefit authorities don't just look at whether households live apart but many other factors in order to determine whether or not a person is a lone parent or is actually in a relationship with a partner whose income/status should be taken into account for benefit claims.

Here is a link that explains how/if housing benefit can be paid to someone who owns a property but does not occupy it.

http://www.dwp.gov.uk/publications/specialist-guides/technical-guidance/rr2-a-guide-to-housing-benefit/working-it-out/income-and-capital/

Property you own but do not occupy [HB Sch 6, HB(SPC) Sch 6; CTB Sch 5, CTB(SPC) Sch 4]

The value of this property is counted as capital but you may be able to get HB/CTB even if the value of the property means that your savings are more than £16,000. This is because the value of the property may be ignored when your savings are worked out, in certain circumstances.
If the property is occupied by an elderly or disabled relative as their home, its value is not taken into account for as long as it is so occupied.
If you have recently acquired the property and you intend to occupy it as your home, its value may not be counted for 26 weeks, or for a longer period if reasonable, from the date you acquired it.
If you are trying to sell the property, its value may not be counted for the first 26 weeks after you start doing this. It may not be counted for longer than this if you are finding it difficult to sell the property.
If you are carrying out essential repairs or alterations so that you can live in the property, its value may not be counted for a period of 26 weeks from the date you first arranged for repairs to be carried out. It may not be counted for longer than this if you are finding it difficult to finish the work.
If you are taking legal action so that you can live in the property, its value may not be counted for the first 26 weeks after you start doing this. It may not be counted for longer than this if legal action is continuing and you cannot live in the property.
If you have left the property after the breakdown of a relationship, and it is occupied by your former partner, its value may not be counted for the first 26 weeks after you left. If the property is occupied by your former partner and they are a lone parent, the property will not be counted for as long as it continues to be so occupied.

Annisele

What sort of business do you run? You don't need to post specifics, but if it's something that means people visit your house you might struggle to find a landlord who'll let you do that from a rented house. Similarly if its something that requires your premises to be inspected, you might struggle to find an appropriate rental.

Generally it's better to sell a house yourself rather than hand the keys back (although there are exceptions). If you did sell with a £10k shortfall, would you definitely have to go bankrupt? Is there a possibility you could arrange a personal loan?

thelem

booMummy wrote: »

[FONT=&quot]We have 2 young children, my husband brings in a modest income, we already live very frugally. I work from home running my own business (with no real income) so that I can stay home full time with our children (a massively important lifestyle choice for us).[/FONT]

The fundamental problem you're facing is you're in a situation where the money coming in isn't enough to finance the lifestyle that you want to lead (there's a £10k difference), so you need to either increase income or decrease outgoings (assuming bankrupcy isn't a serious option). How much is £10k to you? What is the property worth, and what is your combined income?

You say you already live frugally, but it's worth taking a look at the debt-free wannabe board to see just how little some people manage on. You might find there are still savings you could make if you follow their advice.

If you can't make any further significant savings, then you need to look at income. Are there any benefits you could be claiming? Have you considered further borrowing? Can your partner increase his income?

Can you increase your income? It'll obviously be easier once your children start school, but assuming you don't want to wait that long have you looked into other work-from-home careers? How about asking a friend or relative to look after your children one or two days a week so you can work part time? You might even look after their children on a different day so they could do the same. What about evening work? I used to work evening deliveries in a clothes shop (7pm-11pm), and there were lots of young mothers there - they would spend the day with their child, have dinner with their partner and put their child to bed, then work a few hours in the evening.

There are ways you can have lots of quality time with your children while working part time, and that might be a sacrifice you have to make if you want to move house.

booMummy

Thank you for the replies and the link.

I don’t really want to claim HB as a single mother, it makes finding a house to rent far harder since so many only allow working people/no dss now and we have family pets too.

What are the other things they would look at BigAunty with regard to HB? I was considering having a rental contract with my husbands name on so that we can rent a house from a friend who is only supposed to have employed people. Otherwise I’m really struggling to find anyone who can rent to me given my circumstances – poor credit rating, no recent work or landlord references and no income besides tax credits and benefits. My husband would definitely come and stay some nights for the sake of the children too. Really the overall plan so far is to separate temporarily so that a few personal problems involving therapy can be sorted out and then we’ll be back together later. If we don’t do a temporary split now then I’m sure we will separate for good later.

I rang shelter last night and they informed me my husband will have marital rights to the home if I leave which means I won’t be classed as his landlady so that makes things a bit clearer and easier.

No my business would not cause any problems with renting a property.

We have other debts we are currently paying off at £1 a month due to financial struggles when my husband was made redundant so no we wouldn’t be able to get a loan to pay off the £10k

We have reduced all our bills such as no live TV so no TV licence and don’t spend anything on socialising, get second hand clothes etc. but I will give that board a look over, thank you.

I am pretty sure we are claiming everything we possibly can. My husband is waiting for a full time contract, which would increase our income considerably but we don’t know when it will happen.


No I really don’t want to wait any longer to move. I’m really at the end of my tether given our marital problems too. I’m too afraid, depressed and lonely to stay here alone. The effect of living here is causing damage to us all.

Unfortunately there isn’t anyone I could ask to help take care of the children (part of the reason I want to move out of the area). My husbands’ job is also not set hours and involves overnights, often last minute and sometimes gone for nearly 48 hrs so it would be nearly impossible to work even a small part time job around his work. Taking on more work at home with a business to run already and two young children and dealing with depression feels incredibly overwhelming. I’m sure I would have been able to better concentrate on my business and it would be giving me at least a little income if we weren’t in this situation.

I’m planning to ask NRAM (Ha!) if they will give me consent to let on the grounds of a separation and the house going on the market. That situation then causes problems with finding a house to rent while on housing benefit due to the loss of my husbands income. It seems that everyway I look there’s a big problem somewhere and I don’t want to let this offer of a rental house from a friend go, it’s perfect for us.

booMummy

Sorry i forgot to say, the mortgage balance is currently £44,500 and we had it valued last year. The lowest estimate was £32,000 and the highest £40,000 *if* we get the important works finished.

booMummy

There is also a council loan for works we had done for a damp problem and a bathroom roof which needed repairing. The loan states that if we move within so many yrs of having the work done we will have to pay it back in full (we are still well within that period by a few years) unless there is a marriage breakdown and separation. When we enquired about an assisted sale a year ago, NRAM said they couldnt find anything linked to the property but I can't be sure and obviously if i ask the council they will say we do owe it. That is nearly 10k to add to the negative equity.

DannyboyMidlands

"What sort of business do you run?"

Come on, there is no business, we all know that. Its the old Ebay/Avon BS in order to claim tax credits.

A massively important lifestyle choice for them but paid for by everybody else. Nice.

booMummy

My business is an online shop. I would happily give you the address but I wish to stay annonymous. I went through a lot of hard work and business planning to get a loan to start it up and have nearly paid off the £5,000 start up loan. I assure you, there *is* a business.