Advice for my parents - regarding benefits and 2 homes

pretzelnut

shop-to-drop wrote: »

If you don't think it will sell quickly how about putting it in an auction or even keeping it and renting it out for an income? Surely that would cover their £65 week rent/council tax and then some.

I don't think an auction would work, doubt my step dad would agree to it. Its his house that he has lived in for 30 years. He's only been married to my mum for 10 years. He's having a hard time letting it go, and it was a 6 month fight to get him to agree to my mum going on the housing list. He's very stuck in his ways.He will have a figure in his mind that he will not go below, and if an offer is placed for that figure, he will take his time to think it over. He doesn't like being rushed into decisions.

I could ask them about renting it out, but i think now the decision to sell it has been made, I doubt my step dad would change his mind.

Im also unsure how it would work financially, so i doubt he would either. As i said both their healths are deteriorating and having to be landlord to someone who may place them under extra pressure, just wouldn't work. Not all tenants are nice and lovely, and it would be my parents luck that they would end up with the nightmare type. They would worry so much that the rent wasn't being paid and what not.

I am aware that he has investment plans for the proceeds of the sale. Although i am having to slowly press for details, to the point where he feels he is giving me them willingly, he won't even discuss them with my mum, typical of that generation apparently, so i can double check if he's doing the right thing financially for their long term future.

ie, he hasn't handed it over to his ungrateful children, who are circling like vultures who are only interested in blowing his hard earn money on holidays. Not an assumption, they actually ganged up on my step dad one day and asked how much they were each getting so they could look in the holiday brochures. This money has to sustain them for many many years to come. Not that my step siblings see this.

RAS

I suggest that you introduce your step father and step siblings to the idea of deprivation of capital.

Basically if step-dad pays for holidays or anything else for anyone other than him and mum then when they claim benefits the authorities will assume that they still have the money they gave away and reduce their benefits accordingly.

There was a daughter on here most upset because the Council had reduced mum's benefits because she had paid for a car (or major car repairs) for daughter and a holiday for another relative. Mum had paid for both herself and the relative to go away; it was OK to pay for herself but not for the rellie.

pretzelnut

My step siblings don't care about my parents.

They are only interested in themselves. They never visit, or help. Faintest whiff of money and WHAM there they are.

Housing_Benefit_Officer

The property will be disregarded as capital for 26 weeks from the date they claim Housing Benefit - not from the date it is put up for sale - so if it has been up for sale for 8 weeks - they will still get 26 weeks disregard.

If the house is still up for sale after 26 weeks then it can in certain circumstances be disregarded for a further 26 weeks.

Once the property is sold and they receive the money from the sale it is automatically treated as capital (unless you are a pensioner receiving Pension Credit Guarantee element - then the capital will be disregarded for your Assessed Income Period). If you splurge your capital on a massive spending spree then you will be treated as depriving yourself of capital and you will be treated as still holding your capital.

Has your Father applied for Pension Credit? If he gets Pension Guarantee Credit before he moves once he has sold the property the capital will be disregarded for the AIF period - even if that period is for 5 or more years...

Phone Pension Service on 0800 99 1234 and ask for a rough trial calculation with your Mother working and with your Mother not working.

It may be beneficial for your Mum not to work especially if she can't cope and it is making her ill.

Also ask about the Assessed Income Periods and if the capital from a house sale will be disregarded in full.

Carers Allowance is treated as income.

Working Tax Credit will stop.

Disability Living Allowance is disregarded in full.

The Couple Rate for Pension Credit is £220 per week (I think) May be higher.

I should add I do not know the full rules regarding Pension Credit, AIF and capital disregards - you will need to get advice from the Pension Service.

BurnleyBob

The money they have tied up in that property when realised (and perhaps even before it's sold) will ensure they are denied means-tested benefits for a long time because the amount will be way above the £16K threshold. It's bad news for them but they need to know the situation and that there's no way around it especially as the authorities are already aware of the situation.

pretzelnut

Housing_Benefit_Officer wrote: »

The property will be disregarded as capital for 26 weeks from the date they claim Housing Benefit - not from the date it is put up for sale - so if it has been up for sale for 8 weeks - they will still get 26 weeks disregard.

If the house is still up for sale after 26 weeks then it can in certain circumstances be disregarded for a further 26 weeks.

Once the property is sold and they receive the money from the sale it is automatically treated as capital (unless you are a pensioner receiving Pension Credit Guarantee element - then the capital will be disregarded for your Assessed Income Period). If you splurge your capital on a massive spending spree then you will be treated as depriving yourself of capital and you will be treated as still holding your capital.

Has your Father applied for Pension Credit? If he gets Pension Guarantee Credit before he moves once he has sold the property the capital will be disregarded for the AIF period - even if that period is for 5 or more years...

Phone Pension Service on 0800 99 1234 and ask for a rough trial calculation with your Mother working and with your Mother not working.

It may be beneficial for your Mum not to work especially if she can't cope and it is making her ill.

Also ask about the Assessed Income Periods and if the capital from a house sale will be disregarded in full.

Carers Allowance is treated as income.

Working Tax Credit will stop.

Disability Living Allowance is disregarded in full.

The Couple Rate for Pension Credit is £220 per week (I think) May be higher.

I should add I do not know the full rules regarding Pension Credit, AIF and capital disregards - you will need to get advice from the Pension Service.

Thank you that is very helpful.

Doesn't the pension credit thing change in October when the universal credit come into force, drastically reducing the rates.

Or once claim does it continue as long as you claim before october.

Personally all these benefits and what nots are extremely confusing.

I can see it being a lot easier when its all in one place i.e. universal credit.

- My parents are not trying to ''hide'' their assets, they are merely wondering if they are receiving everything they are entitled to right now, as it is so complicated.

They are fully aware that they loose everything means tested once the house is sold.

So i may have to get them to look a lot further into things, i.e. renting out, perhaps by using a property manager, so they don't have the stress.

HB58

BurnleyBob wrote: »

The money they have tied up in that property when realised (and perhaps even before it's sold) will ensure they are denied means-tested benefits for a long time because the amount will be way above the £16K threshold. It's bad news for them but they need to know the situation and that there's no way around it especially as the authorities are already aware of the situation.

I don't see that this is 'bed news'. The parents will be able to support themselves without worrying about jumping through DWP hoops or about making ends meet. That is worth a lot, in my book.

Alter_ego

Housing_Benefit_Officer wrote: »

Has your Father applied for Pension Credit? If he gets Pension Guarantee Credit before he moves once he has sold the property the capital will be disregarded for the AIF period - even if that period is for

I should add I do not know the full rules regarding Pension Credit, AIF and capital disregards - you will need to get advice from the Pension Service.

You can't get pension credit till you are a pensioner - He's 62

pretzelnut

HB58 wrote: »

I don't see that this is 'bed news'. The parents will be able to support themselves without worrying about jumping through DWP hoops or about making ends meet. That is worth a lot, in my book.

Im sure it will be a great weight off their shoulders. IF the house ever sells.

pretzelnut

Alter_ego wrote: »

You can't get pension credit till you are a pensioner - He's 62

From what I've been reading he was entitled to claim it in 2012.
But again i am unsure whether its the correct benefit, i.e. advantages of this over other benefits and impact on the future etc, as universal credit means the rules go from the oldest in a couple to the youngest in october.

Im not sure if it means that they will be back to square one in october when the new rules come. in.