Housing benefit capital

nelsongoat

I've just had my new claim for housing benefit turned down. I live in a rented house but own another that I rent out. According to housing benefit calculations I have more than £25000 of equity on the property after the 10% deduction. As I put on the claim form, the house badly needs new windows and a new roof, which I was going to use the capital to pay for using a secured loan for £20000 over the next couple of months. If I now do this, will this reduce my available capital in the eyes of the housing benefit people and allow me to claim housing benefit? Or will they think that I'm deliberately spending the capital? Any advice appreciated, thanks.

poppy12345

I'm not sure why you want to claim housing benefit when you own your own home and rent it out. Shouldn't you be living in your own house instead of renting it out?

nelsongoat

I was working until last week and had no intention of claiming housing benefit. The house I rent out is in a different location to my home and not near my children's schools or my wife's work and it doesn't have enough bedrooms for my family to live in. To move into it would mean my wife leaving her job and my children moving schools. It doesn't seem the right thing to do at the moment as it would make us worse off. Also, I've rented it the house out and I can't just kick the tenants out during their tenancy.

fishybusiness

Sell it, needs must unfortunately.

nelsongoat

That's the longer term plan if I don't find another job. If I sell it now, it's likely to take a couple of months before I get the money, also it's likely to sell for much less than the councils valuation as it needs windows and roof replacing. I expect I'll end up with less than £5000 and it will take several months before I get the money. It doesn't help me now.

poppy12345

nelsongoat wrote: »

I've just had my new claim for housing benefit turned down. I live in a rented house but own another that I rent out. According to housing benefit calculations I have more than £25000 of equity on the property after the 10% deduction. As I put on the claim form, the house badly needs new windows and a new roof, which I was going to use the capital to pay for using a secured loan for £20000 over the next couple of months. If I now do this, will this reduce my available capital in the eyes of the housing benefit people and allow me to claim housing benefit? Or will they think that I'm deliberately spending the capital? Any advice appreciated, thanks.

That £20,000 loan would wipe out your housing benefit claim if claiming was possible. It would most likely be classed as deprivation of capital if you spent it on repairs...

nelsongoat

So, using capital to spend on essential repairs, declared on the claim form is still likely to be treated as deprivation of capital? I still will go ahead anyway unless an estate agent says I'm better selling as it is.

IAmWales

nelsongoat wrote: »

So, using capital to spend on essential repairs, declared on the claim form is still likely to be treated as deprivation of capital? I still will go ahead anyway unless an estate agent says I'm better selling as it is.

It's not an essential repair on your home though, which may be acceptable. It's a loan to add value to a capital asset, an investment.

If your wife is working how much HB would you be entitled to? Are you applying for any work you can, even if it's just a stop gap? All the main retailers are recruiting for Christmas, as are Royal Mail. As long as you're making up for the shortfall in HB you'll be better off than selling the property.

poppy12345

nelsongoat wrote: »

So, using capital to spend on essential repairs, declared on the claim form is still likely to be treated as deprivation of capital? I still will go ahead anyway unless an estate agent says I'm better selling as it is.

Yes! you're planning on a loan for £20,000 to spend on your house that you rent, then you want to claim housing benefit for another? :eek: Deprivation of capital for sure!

Housing_Benefit_Officer

I will dig out the legislation tonight or at the weekend...

FBaby

As I put on the claim form, the house badly needs new windows and a new roof, which I was going to use the capital to pay for using a secured loan for £20000 over the next couple of months.

Do lenders give loans of that value, even if secure to the unemployed?