Housing Benefit after Right to Buy

Dvalin

We bought my mother's house under the right to buy scheme, myself and my wife as joint applicants. We have been living together over a year but my wife and my mother have fallen out. If my mother transferred her share in the house to us could she then claim housing benefit on another place? Or would this be considered deprivation of capital?

pmlindyloo

A bit confused, sorry.

You bought your mum's council house under the Right to Buy? Were you living there at the time?

Whose name(s) are on the deeds? Is there a mortgage? Whose name(s) on the mortgage?

tomtom256

Dvalin wrote: »

We bought my mother's house under the right to buy scheme, myself and my wife as joint applicants. We have been living together over a year but my wife and my mother have fallen out. If my mother transferred her share in the house to us could she then claim housing benefit on another place? Or would this be considered deprivation of capital?

Yes it would, it would also probably negate the discount received as well as all owners would have agreed not to sell/transfer the property for a set amount of years.

There will also probaby be a covenant on the deeds to this affect also.

BigAunty

Your mother can gift her share of the property to you rather than accept the market rate for it (what would this be and why wouldn't you offer her the valuation price?).

However, if the local council believe that she has intentionally done this in order to maximise her benefit entitlements, then they can refuse her HB and council tax claims on deprivation of capital grounds. They would treat her as if she had that capital (a concept known as notional capital).

Dvalin

We bought the house outright after living there 1 year. No mortgage. All three of us are on the deeds. Transfers are fine, I believe, between joint applicants.

Poppie68

This is why RTB should be stopped....parents give up their secure tennacy so their children get a cheap roof over their heads, if they fall out the parent ends up homeless with the stress of finding a new home were before they had a home for life.

Dvalin

BigAunty wrote: »

Your mother can gift her share of the property to you rather than accept the market rate for it (what would this be and why wouldn't you offer her the valuation price?).

However, if the local council believe that she has intentionally done this in order to maximise her benefit entitlements, then they can refuse her HB and council tax claims on deprivation of capital grounds. They would treat her as if she had that capital (a concept known as notional capital).

I would love to pay her for her share, however we spent all our money buying the place - she put no money in herself. It's not really urgent at the moment but I can see it getting there if things persist. If she did give us her share and was assessed at having a notional capital of say 40K would this notional capital 'run out' eventually, in the sense that had she received it and spent it on rent there would be a time when she had less than the limit for HB?

lighting_up_the_chalice

Dvalin wrote: »

I would love to pay her for her share, however we spent all our money buying the place - she put no money in herself. It's not really urgent at the moment but I can see it getting there if things persist. If she did give us her share and was assessed at having a notional capital of say 40K would this notional capital 'run out' eventually, in the sense that had she received it and spent it on rent there would be a time when she had less than the limit for HB?

Eventually, yes. But in the mean time, the notional capital would also be taken into account for any other means tested benefits she receives.

lighting_up_the_chalice

Dvalin wrote: »

I would love to pay her for her share, however we spent all our money buying the place - she put no money in herself.

You could always borrow, secured on the property.

jetplane

Dvalin wrote: »

I would love to pay her for her share, however we spent all our money buying the place - she put no money in herself. It's not really urgent at the moment but I can see it getting there if things persist. If she did give us her share and was assessed at having a notional capital of say 40K would this notional capital 'run out' eventually, in the sense that had she received it and spent it on rent there would be a time when she had less than the limit for HB?

Your mother may not have put cash into the property but does, the not unsubstantial, discount you benefited from not count as her conrtibution?? Jeez if you cant pay her share why can't your wife address whatever it is that they have fallen out over? And yes if she gives you her share then she will have notional capital. Why dont you move out and rent somewhere else, as you currently have no mortgage outgoings?

NYM

She may not have put hard cash in, but it's through her tenancy you were able to purchase it.