Universal credit and divorce settlement

Firefly21

Hello, 

I have a question. 
I'm in a weird situation. Divorced 2 and half years ago in UK. My ex husband apparently bought a house back in the country where we come from, while we were married, before we even came to UK. I've never seen the papers, never been to sign anything. He says now that he wants "to get rid of me" and wants to give me some money as divorce settlement, in order for me to not ask for anything from that house. It is very complicated, is his mum's house, or was.
Marriege ended bad, child protection involved and I lived in fear for a few good months. 
Now I'm willing to give him what he wants for whatever money he would give me, don't know 20k or 30k, something like that. I don't want to fight with him in the court, I can't afford that anyway. 
Would this affect my universal credit? Problem is I can't lose my universal credit for now, until I'm on a good job.
I've seen they don't take that money into account if it's from selling a house. But in my case, he doesn't want to sell it, he wants to make sure it's on his name, without me having any rights to it. That's why he would just give me some money.
Could I use that money for a deposit for a house where I would live?
Is there anything I can do about this situation?

Please advise me, I don't know what to do.

Thank you! 

Rubyroobs

The money can be disregarded for a period of time ( 6 months maybe? ) if being used as a deposit for another home. It may be longer than that but would likely need to go to a UC decision maker. If not being used to but another home then your Uc would stop until your capital drops below 16k again.

Spoonie_Turtle

I don't think it can be disregarded.

Amount to be used to purchase premises
H2119 Where a person has received an amount within the past 6 months which is to be used to purchase premises that the person intend to occupy as their home, that amount can be disregarded from the calculation of that person’s capital where it
1. is attributable to the proceeds of the sale of premises formerly occupied as their home or
2. has been deposited with a housing association (see H2045) or
3. is a grant made to the person for the sole purpose of purchasing a home1.
https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/1157193/admh2.pdf

None of those apply, it's probably not technically from a sale but you didn't occupy the house anyway.

However if you receive the money and can put down a deposit for a home within the same assessment period you would be okay (and just let them know what had happened afterwards, to be on the safe side).  Other than that, I don't see how it could be disregarded.

Muttleythefrog

I tend to agree with Spoonie.

Firstly... so sorry for all you've been through and certainly can understand the wanting to settle matters and move on.

Concern I have is that you might have been claiming U/C and living with partner (in UK) when this property was owned and if so then it should have been declared - may or may not be relevant.... I hope not otherwise it could further complicate advice.

But to the main point I am not sure there is a situation where such monies could be disregarded - it doesn't involve a property sale and you're not living in the property or planning to. I do also have concerns about your intention because while you could use the monies as a deposit on buying a property to live in (and it is likely this would be acceptable for U/C) it would probably be very difficult for you to fund the rest of the purchase through a mortgage due to being on benefits...i.e. I'm not sure if this option is realistically viable.

I think a top down look at the circumstances might be necessary to give advice on best course of action as plenty to consider including of course whether stalling matters until you get a decent paying job and come off U/C is sensible.

Firefly21

Hello, 
As I said, weird situation.. We lived in that house while we were there. Had it from his mum, fully refurbished it and lived there for about 3 years. And when he had to sign for the taxes, they didn't let him, without my signature, because they said he was married. That was when he told me he bought the house, but it was on his name.
Then we came to UK.
I only had universal credit after we separated, because I had to work less hours, and I started to work in schools, with an agency. Then filed for divorce and the rest. Finished 2 and half years ago. All messy and problems.
Now I have a new partner and a baby, so I'm not back at work yet.  And with the rents high and all, I really want us to buy a house. He is working, and we count on his income for the money from the bank, just that we don't have the deposit. And since my ex keeps pressing me to solve that for him, I thought I could use that money as deposit for a house.
But we still need the universal credit. I hope soon I will be able to go to work and I know it will be better then, but until I can do that, I can't risk loosing UC. 

Spoonie_Turtle

An right, so yes you did occupy it but a long time ago, however is it actually a sale?  If none of it was in your name then it's (perversely, considering what you've told us about the separation) technically more of a gift.

If you're able to get a mortgage using this money as a deposit, it can work IF it goes into your bank account and back out again as the deposit within the same UC assessment period. 

The reason for that is - as far as I understand it - technically you'd no longer be eligible for UC when you have it, so you should close your claim, but then when it goes back out you become eligible again and can reopen your claim within the same month; you would still have the same assessment period so when it comes to the payment for that period the overall effect is if you'd never interrupted the claim at all.  And UC is based on the circumstances of the last day of your assessment period when you no longer have the money.  So there's no point going through all that hassle when you're still going to have a UC payment anyway.

If it wasn't possible to do it in the same assessment period, but you used it for the deposit in the following assessment period, you would only lose one UC payment.  Not ideal, of course, but shouldn't be disastrous like just not being able to claim again could be.

Muttleythefrog

Spoonie_Turtle said:

An right, so yes you did occupy it but a long time ago, however is it actually a sale?  If none of it was in your name then it's (perversely, considering what you've told us about the separation) technically more of a gift.

If you're able to get a mortgage using this money as a deposit, it can work IF it goes into your bank account and back out again as the deposit within the same UC assessment period. 

The reason for that is - as far as I understand it - technically you'd no longer be eligible for UC when you have it, so you should close your claim, but then when it goes back out you become eligible again and can reopen your claim within the same month; you would still have the same assessment period so when it comes to the payment for that period the overall effect is if you'd never interrupted the claim at all.  And UC is based on the circumstances of the last day of your assessment period when you no longer have the money.  So there's no point going through all that hassle when you're still going to have a UC payment anyway.

If it wasn't possible to do it in the same assessment period, but you used it for the deposit in the following assessment period, you would only lose one UC payment.  Not ideal, of course, but shouldn't be disastrous like just not being able to claim again could be.

Late at night... but I'm thinking realistically it's going to be months isn't it. Assuming she gets the money and they immediately get an offer accepted on a property then conveyancing to the point of handing over deposit for exchange (and it might be less than she gets 'gifted') is going to be likely 2 or 3 months minimum unless fortunate or restrained by criteria of an auction. But I'm also mindful the rest of the funding it sounds like her new partner will seek a mortgage and is in work... that raises then the question of whether her U/C should already be affected by his means or will be regardless of the monies in question... so unless I've missed it maybe the next logical question is what are the new partner's circumstances... are they living together and is his income being declared and if it is then it probably isn't high (issue for mortgage.. has he got an in principle offer from the bank?). 

Really not sure what to advise except we need more information... I do though think there are risks around the timing of monies received and transacting a property... so much can cause delays... and if that causes even temporary loss of U/C which she seeks to avoid it could be deterrent to this kind of plan... but then I'm also wondering if there will be any entitlement to U/C anyway when the circumstances of household considered.

TELLIT01

Firefly21 said:

I only had universal credit after we separated, because I had to work less hours, and I started to work in schools, with an agency. Then filed for divorce and the rest. Finished 2 and half years ago. All messy and problems.
Now I have a new partner and a baby, so I'm not back at work yet.  And with the rents high and all, I really want us to buy a house. He is working, and we count on his income for the money from the bank, just that we don't have the deposit. And since my ex keeps pressing me to solve that for him, I thought I could use that money as deposit for a house.
But we still need the universal credit. I hope soon I will be able to go to work and I know it will be better then, but until I can do that, I can't risk loosing UC. 

Did you declare the change of circumstances regarding your partner?

Firefly21

TELLIT01 said:

Did you declare the change of circumstances regarding your partner?

Yes. It's all declared. We didn't hide anything, I have no worries about this. We were looking into getting a mortgage. And now this thing with my ex husband came, that he wants to "get rid of me" because the law in our country says that goods from the time of marriage are to be split. That's why he wants to give me some money so I can resign any rights from that house.
I was just thinking, from all what people have said here, could we do the document as if I'm basically selling my share to him? Would that help me not to lose UC? Because I need to count on it too for the mortgage.
Thank you

poppy12345

Firefly21 said:

TELLIT01 said:

Did you declare the change of circumstances regarding your partner?

I was just thinking, from all what people have said here, could we do the document as if I'm basically selling my share to him? Would that help me not to lose UC? Because I need to count on it too for the mortgage.
Thank you

No, that will not help because you're not actually selling the home you live in and the money you receive will not be disregarded.

HillStreetBlues

poppy12345 said:

Firefly21 said:

TELLIT01 said:

Did you declare the change of circumstances regarding your partner?

I was just thinking, from all what people have said here, could we do the document as if I'm basically selling my share to him? Would that help me not to lose UC? Because I need to count on it too for the mortgage.
Thank you

No, that will not help because you're not actually selling the home you live in and the money you receive will not be disregarded.

Would another issue be, if the house is classed as jointly owned by the OP and OP's ex and Op's share is over £16k  should the OP be currently claiming UC? as OP the would be owner of a second property.