Housing Benefit Help

piglet22

My mum has MS and receives ESA. In 2011, she transferred her house to me because she had got into a lot of debt, was extremely vulnerable to salespeople and compulsive hoarding. To get rid of the debt, I put a small mortgage on the house and got power of attorney for finances. I have been paying the mortgage and any payments towards her debts not covered by it.

At the end of last year it was decided that my mum could no longer live in the house. As she needed care, I had to put her on the housing register. Having gone through the application, she was successfully placed on it and the local council appeared happy with the terms of the transfer (i.e. that she was eligible for housing rather than having to look privately). In December she was placed in extra care housing and currently receives housing benefit to cover rent. She has care provided but pays a contribution out of her benefits.

This is where I am struggling. The house is undergoing sale and I am not sure who the proceeds belong to, realistically after all debts settled will be about £50,000.

On one hand, I have been advised by the benefits advisor that it is unlikely the local council will raise claim to the proceeds of the house and therefore the housing benefit claim should remain valid. This being because they were previously satisfied by the reasons it was transferred and also the time past being four years. At no point has anyone said I have to advise when the house sells or even mentioned the house. On the other hand, social services are saying that once the house is sold, my mum will become self-funding for care as the council will treat it as if it is still hers. I presume this would mean her benefits would stop and so if she has to pay for care, she will pay for everything else ( and lose ESA, DLA, housing benefit).

I am not expecting claim to the proceeds but on one hand, I am being told the house is no longer viewed as hers and then the other, I am not. I just want everything to be above board with no risk that there will be concern later on.

To me, the ideal would be that the housing benefit remains, my mum is then self-funding for care (paid for from the proceeds of the house) and she remains in receipt of DLA. I just don't understand how one side can have claim and not the other.

nannytone_2

your mother can't just 'gift' a valuable asset.
i does she receive income related or contributions based ESA?.
i assume she is in sheltered housing and social services provide carers?
if she receives income based ESA she will lose housing benefit and council tax support and ESA until the capital amount drops under 16k and benefit would be tapered until the amount frops under 6k.
DLA would be unaffected. it is likely that she would also have to meet the full cost of her care, but each individual council has their own rules when it comes to the cost of contributions required.

if she receives contributions based ESA, then ESA would also be unaffected

piglet22

Thank you for your reply and I tend to agreed with you that it seems she should be self-funding in all areas. However, she hasn't just gifted it per se.

We went to the CAB because of her debt and they proposed a payment plan that was rejected by creditors. In the meantime, my mum's spending didn't stop and was quite evidently part of a bigger problem, compulsive hoarding. She remained vulnerable to door-to-door salesmen and was still agreeing to things even after the talks with the CAB. We went to the solicitor to discuss the matter and it was decided I needed power of attorney to be able to a) speak to the creditors and b) stop these ridiculous house purchases. I should have taken it further as ultimately she was targeted by a local company charge ££ over the odds for replacement windows and guttering.

So, in this respect the house was transferred so that we could mortgage and clear the debt, a mortgage that my mum didn't contribute to. At the time, my mum had absolutely no intention of moving and this has only come about because social services said she was no longer safe at home. To this point, my mum didn't want the house sold at all (partly because she wanted the option to go home but that was unrealistic).

GlasweJen

Your mums DLA won't change, you can get that even if you're a millionaire.

ESA is trickier - is mum on income based or contributions based? Also is she in the work related activity group or the support group? What age is mum, could she claim pension credits instead of ESA?

How much of a mortgage did you take out on the house? If a solicitor was involved at the time he may be able to write to social services to explain that in reality you have an interest in X% of the property as you paid it. If I'm understanding what you're saying your mum basically sold you the house in exchange for you paying off her substantial debts? You might need to engage your lawyer again.

racon

Hey I can see what the OP did and why, but there is still the case of the disposal of a valuable asset.
What was the value of the property at the time? If there was a mortgage or legal charge against the property, what was it's value?
The difference between the two (less 10%) is the value of the gift. What the OP then did is of no consequence (except to the mother and her creditors).

Housing_Benefit_Officer

Clear case of deprivation of assets.

help4help2013

based on what you have said i would agree with the above post as they will see it as deprivation of assets

piglet22

I am struggling to see why this is a clear deprivation of assets.

With regards to the transfer, if we had not taken out the mortgage and power of attorney, the debt would almost certainly have escalated to the point where bailiffs, a charge or worse would have been put on the property. This process started in the middle of 2010 with the transfer in January 2011. The intention was for my mum to live in the house for the rest of her days but no-one can predict the nature of MS, and ultimately the decision was out of our hands. There is an argument that we have been responsible for the mortgage and upkeep for the past four years. As it stands, I have no intention of taking anything out of the proceeds of sale aside from the costs associated with the recent move.

If we hadn't declared the house to all relevant parties, then yes, I can see your point but we have always been upfront about the circumstances and will continue to be. The question I originally asked was whether the advice from the benefits advisor was right in regards to housing benefit because her care provision is going to use up the funds fairly quickly. I can see from the answers that it isn't and as such, on sale will notify ALL relevant parties.

allen35

Who is going to get the £50,000 less costs from the sale, i presume your mum.

If this money belongs to your mum she won't qualify for Housing Benefit as she will be over the £16,000 savings threshold, if on Pension Credit (approx' 63 yrs old) she may still receive a small amount.

My Local Authority have a savings threshold of £23,750, sure it's the same or similar across the board where she will have to fund her own care.

Whilst she has been getting benefits such as ESA/HB/CTS the property will more than likely of been disregarded until it was sold, once sold and if the intentions are not to buy mum another more suitable property it will be taken into account as savings.

Once she starts paying her care and rent costs and her savings decrease to below £16,000 or she become Pension Credit age she may then qualify for additional financial support.

As said in an earlier post DLA won't be affected and if on Contribution based ESA