Loss of Benefits with Divorce Settlement

Chaya

I am trying to help my sons dad (we split years ago and have had a cordial relationship since). 8 years ago he met and married someone and has since split up and moved out of the marital home (18 months ago). When he got married he sold his house and paid off the outstanding mortgage on his new wifes house, but did not get his name put onto the property. He also paid his wife the balance of his money to represent about a half investment in the home and she put this into her bank account in her name only. He has been on means tested living and disability benefits for years through ill health and in more recent years also had a stoke which means he now gets easily stressed out. He left the marital home because he could not stand the stress any more.

He is 56 and since moving out of the marital home he has been living with his elderly mother in an old peoples bungalow. He is under the impression that if his wife sells the house and transfers his money he will lose his benefits because it will amount to circa £60k. I read that the capital will be ignored for a period of 26 weeks if he uses it to buy another house and will not be considered depriving himself of capital. But I am confused by all the sub-rules. i.e. his wife continues to live in the marital home with her adult son (and possibly new boyfriend); it is now 18 months since leaving. All he wants to do is to go back to the situation before he met his wife. i.e. he wants his wife to sell the house or buy him out and to use the capital to buy his own home to live in so he can move out of his mums bungalow.
I want to help, he is my sons father (also concerned about his childrens inheritance). I worry for him that he risks losing everything if he does not force a settlement with his wife.
Can anyone advise him.
Thank you

pmlindyloo

You are correct that any capital from the sale of the house will be ignored for 26 weeks if he buys another house.

However, for this to happen he really needs to get the divorce and financial arrangements sorted out.

A useful guide:

http://www.adviceguide.org.uk/england/relationships_e/relationships_relationship_problems_e/ending_a_marriage.htm

BigAunty

Does the wife even want to sell up? She sounds quite cosy there. If she doesn't consent to selling and refuses to negotiate a settlement, then he will have to take legal action. Ask on the housing forum about his options if she doesn't cooperate. The Shelter website also has a good relationship breakdown section.

Apart from the 26 week period to buy a new property, it is true that sums over 6k will reduce entitlement to means tested benefits (like council tax) while sums over 16k rule it out. Some benefits are not means tested, like Disability Living Allowance.