Part pay mortgage with pension lump sum while on ESA?

gentlepurr

Help for a friend please, he is on Support Group ESA, i dont know whether its income or contributions rated. He is only claiming ESA (£106 per week??) and receiving part of the interest paid on his mortgage, he is having to pay his own interest only shortfall of about £50 per month, and doesnt receive any other benefit.

Friend will soon be able to receive a small pension of around £55 per week and have a lump sum payment. He is hoping to pay the lump sum off the mortgage, will he be allowed to do this/

Also, how much of his weekly pension will be taken into account and deducted from his weekly allowance?

Horseunderwater

I cannot answer the pension part, but I can tell you that they are on income related ESA as they are getting help with interest on the mortgage.

xylophone

be able to receive

Can choose to receive( take pension at earliest permitted date) or has actually reached the retirement age specified in his scheme or on his policy? This might make a difference?

If he took the lump sum would it be regarded as capital/savings the minute it was credited to his bank account?

The pension income makes a difference to the income related ESA?

http://www.nidirect.gov.uk/employment-and-support-allowance-rates

He should check out his situation with a CAB Benefits Adviser?

lld01

gentlepurr wrote: »

Help for a friend please, he is on Support Group ESA, i dont know whether its income or contributions rated. He is only claiming ESA (£106 per week??) and receiving part of the interest paid on his mortgage, he is having to pay his own interest only shortfall of about £50 per month, and doesnt receive any other benefit.

Friend will soon be able to receive a small pension of around £55 per week and have a lump sum payment. He is hoping to pay the lump sum off the mortgage, will he be allowed to do this/

Also, how much of his weekly pension will be taken into account and deducted from his weekly allowance?

The ESA with be reduced by £55/week. Also any savings over £6k left after paying over to the lender will be taken into account.

The SMI will be reduced when the mortgage balance is next reviewed by the DWP, this is done every year on the anniversary of the claim.

oldboy64

gentlepurr wrote: »

Help for a friend please, he is on Support Group ESA, i dont know whether its income or contributions rated. He is only claiming ESA (£106 per week??) and receiving part of the interest paid on his mortgage, he is having to pay his own interest only shortfall of about £50 per month, and doesnt receive any other benefit.

Friend will soon be able to receive a small pension of around £55 per week and have a lump sum payment. He is hoping to pay the lump sum off the mortgage, will he be allowed to do this/

Also, how much of his weekly pension will be taken into account and deducted from his weekly allowance?

Being on a means tested benefit any capital that he receives will certainly affect the amount of his benefit. If he part pays his mortgage down, he will still be assessed as though he still has access to that capital.

The only way that a lump sum can be made exempt from this assessment is if he uses it to purchase another different property as his only main residence.

ie he must sell the one he has now and buy another.

pmlindyloo

link about Pension Credit.