State Pension/benefits and inter-family rental payments

terryw

elmer wrote: »

As Big Aunty has already said as your MIL owns part of the property, she cannot claim HB.
It wont be a contrived tenancy as there is no tenancy as she owns part of the property.

elmer

I think Big Aunty is probably correct, but this is a very unusual situation and not that much different from someone living in a shared ownership dwelling.

nannytone_2

you cant claim housing benefit to pay rent on a property you previously lwned.

and ypur MIL still actually owns 2/3, so they wont even consider it.

DiscoMaysie

I think I agree, but dont therefore understand how a general shared ownership schemes (such as Peabody Trust etc) can still qualify for HB then?!
Am I missing the point?

Also found this on the DWP website, which seems to suggest that HB would be available, as the transfer of partial equity was to keep them in their property.
Previous owner

You cannot claim HB if you or your partner previously owned the dwelling which you now rent, unless you could not continue to live in the property without the transfer of ownership

nannytone_2

but ownership hasnt been transferred ... she still owns 2/3.

what is the market rate for a house of the same size, in the same area?

fluffymovie

She isn't the previous owner, she is a current owner.

The previous owner regs relate to people who have for example, sold their property to a friend and then agreed to rent it back. They cannot claim HB on that property until 5 years have passed or they prove that they could not have remained in that property without selling it (for example, mortgage company had started reposession)

DiscoMaysie

But 1/3 of the house WAS sold though, so why cant rent be paid for the 1/3 that they dont own?

The house was up for sale with a local estate agent for £210k when we bought the 1/3 share, which is how we found out about their terrible financial state and huge debts. The mortage had substantial arrears, but reposession proceedures had not yet started though.

The rental value was £600 PCM on simiar properties nearby, hence why we valued the rent at £200 for the 1/3 share that they didnt own.

Poppie68

fluffymovie wrote: »

Your MIL owns 2/3rd of a property that she lives in. This means she will not be entitled to Housing Benefit for the £200 she was paying you.

She has other income related benefits open to her such as Pension Credit which she should claim and then perhaps she may be able to continue to repay the £200 pcm you ask for (or say that you may not ask for?)

However, I can confirm that she is not entitled to Housing Benefit for the address she lives in now.

OP Fluffymovie has given you the correct advice...Fluffymovie works in Housing Benefit and CouncilTax.
Your MIL needs to look at other income related benefits.

fluffymovie

Ok well as a Benefit Manager, I would not be able to pay your MIL but it's up to you. I will bow out of thread now.

DiscoMaysie

fluffymovie.
Many thanks for the advice. Please dont think I was questioning your knowledge/opinion, I just dont understand the reasoning behind the benefits system as I have absolutely no experience of benefits of any kind - so it is all completely new to me.

I also appreciate that what may appear to be logical/common sense to my simpleton's view often does not apply when tested through some of the government eligability criteria. Although in this case I can see the reasons why!

Thanks again to everyone for the advice. At least I have a much better idea of where things need to head now!

paddedjohn

OP, looks like your only option is to get a tennant in to rent your 1/3 part of the property.