Mortgage Interest being paid by DWP

LyndaMcK

2 years ago I had to retire through ill health. I could no longer work and I applied for, and now receive help with most of my mortgage interest payment. The mortgage is only £30000.
However, my mortgage is interest only, so the mortgage is not reducing, which is worrying me.
I am due to get an endowment pay out for half of the outstanding sum.
What should I do with that pay out? I am concerned that I will lose my government help with the interest, which I can't do without, and yet I want to see my mortgage reduced by the amount of the pay out.
Can anyone advise me?

silvercar

Tread carefully because a payout will result in you having savings that could effect any means tested benefits.

I am not saying this with any definite knowledge on whether an endowment tied to the mortgage would be counted as savings and possibly "deprivation of assets" if used to reduce the mortgage or whether you would be expected to use the money for its intended use.

Maybe swings and roundabouts, either it reduces your mortgage and therefore mortgage benefit, or it is savings that you may be expected to use to live off and use to pay your own mortgage.

Of course this depends on any other savings and any other benefits you may be receiving or expected pension.

What was the plan to clear the mortgage, had you been in good health? I assume that the endowment was part of this?