Moving to another town and benefits?

oneblondebrow

Hi all,

Back story please bare with me

My parents are in a sticky situation at the moment, they have had to put their house up to auction at the end of October and have to sell it, the reason for this is that my father has been made redundant and my Mothers part time job will not cover mortgage or paying off a large debt that was accrued after my Dads business went under also were they live currently there are jobs especially not for paying enough to cover mortgage and debts.

they want to move back here, I live in a town in Essex, they did originally live here but moved 12 years ago, would they be able to get any help with housing here? They will both be searching for jobs and will jump on any job they can, also 90% off their family live in this town but unfortunately none of us have any room for them to live with us.

getting pretty worried about them if im honest.

Housing_Benefit_Officer

For benefit purposes the capital value of the house would be disregarded for 26 weeks from the date it was put up for sale. The value can be disregarded for longer than 26 weeks if still up for sale. Once sold we would look at any proceeds and what has happened to the proceeds. How much will they make from the sale and what do they plan to do with the sale proceeds.

Auctioning a property normally cost more in fees and they normally sell for a lesser value - is this the only way they can sell it?

Have they asked the mortgage company for a break in paying the mortgage while sorting out their finances? Have they done anything regards their creditors to reduce their repayments while they sort out their finances?

oneblondebrow

Housing_Benefit_Officer wrote: »

For benefit purposes the capital value of the house would be disregarded for 26 weeks from the date it was put up for sale. The value can be disregarded for longer than 26 weeks if still up for sale. Once sold we would look at any proceeds and what has happened to the proceeds. How much will they make from the sale and what do they plan to do with the sale proceeds.

Auctioning a property normally cost more in fees and they normally sell for a lesser value - is this the only way they can sell it?

Have they asked the mortgage company for a break in paying the mortgage while sorting out their finances? Have they done anything regards their creditors to reduce their repayments while they sort out their finances?

Thanks for the speedy reply, unfortunately auction is the only way for them due to the time frame they have and the type of property (its a rural house with shop built in). Mortgage company have basically said "you sell it or we will" they may come out of it with a little savings but they intend on using that to private rent in my town, I was wondering if they would get any help until both of them find jobs, hopefully they will get jobs quickly but both are 60 years old.

Housing_Benefit_Officer

If their savings are below £16,000 then they would probably qualify for Housing Benefit depending on their income. They would qualify for a 1 bedroom LHA rate. The rate depends on the area they are moving to.

oneblondebrow

Housing_Benefit_Officer wrote: »

If their savings are below £16,000 then they would probably qualify for Housing Benefit depending on their income. They would qualify for a 1 bedroom LHA rate. The rate depends on the area they are moving to.

Thanks for you help.

One more question, what does LHA stand for and does it matter if it is a 2 bedroom house?

Housing_Benefit_Officer

oneblondebrow wrote: »

Thanks for you help.

One more question, what does LHA stand for and does it matter if it is a 2 bedroom house?

Local Housing Allowance. They can move into whatever size house they want but benefits will be restricted to the size of property the legislation says they need.

They could for example move into a 2 bed property at £200 per week but the 1 bedroom LHA rate would be £100 per week so they would have a shortfall of £100 per week.

As Housing Benefit is means tested then the £100 could be further reduced depending on their income and savings.

oneblondebrow

Housing_Benefit_Officer wrote: »

Local Housing Allowance. They can move into whatever size house they want but benefits will be restricted to the size of property the legislation says they need.

They could for example move into a 2 bed property at £200 per week but the 1 bedroom LHA rate would be £100 per week so they would have a shortfall of £100 per week.

As Housing Benefit is means tested then the £100 could be further reduced depending on their income and savings.

Once again many thanks for your help.

One last question I promise .

Just to clarify even though they have lived in a different town/county for the last 12 years there wont be an issue them claiming housing benefit in their old town which is also my town?

Housing_Benefit_Officer

oneblondebrow wrote: »

Once again many thanks for your help.

One last question I promise .

Just to clarify even though they have lived in a different town/county for the last 12 years there wont be an issue them claiming housing benefit in their old town which is also my town?

No issue. They can claim anywhere in the country as long as they have a rental liability.

I would also look about the local Council House waiting list - some Essex authorities have placed a 5 year local residence criteria.

dktreesea

Housing_Benefit_Officer wrote: »

No issue. They can claim anywhere in the country as long as they have a rental liability.

I would also look about the local Council House waiting list - some Essex authorities have placed a 5 year local residence criteria.

I thought they had to be resident in an area for a certain period before they can claim housing benefit, or am I getting mixed up and does that only apply to people coming back from abroad?

bloolagoon

If they don't intend to buy a house with their equity then I think its treat as capital and the 26 weeks disregard is only for those looking to buy a new home. Perhaps people can confirm or dispute. This means that they'd need to pay their own rent if over the limits.

BigAunty

Entitlement to housing benefit is about means testing (plus a few other rules around nationality, habitual residence and so forth ). There is no local connection criteria. A person who is entitled to HB due to their low income/capital has complete freedom of movement across the UK.

Applying for social housing can often have a local connection criteria. Many social housing landlords have a degree of discretion over who they accept onto their social housing waiting lists/choice based letting schemes so they quite often have rules that require a strong local connection, such as close family or employmentn or length of residence in the area. It will vary from area to area, landlord by landlord in England.

A local council has no discretion in how they must process a homelessness application as there are core rules that they can't ignore. Having said that, I believe there is still a local connection requirement. However, the Shelter website will clarify the homelessness process.

Get your parents to read up on the section of the Shelter website for homeowners at risk of repossession and arrears and to speak to Shelter. There are rules and guidance in place that compel lenders to only repossess as a last resort and some lenders will postpone it before initiating the final action. There is a lot of info there on the Shelter website to guide them. It is a shame if they are being harried towards an auction sale as the expenses are high and the selling price is likely to be low.

Get them to post on the debt free wanabee board to find out how to deal with their other debts or to contact a debt management charity like Step Change.