Equity release- pension credits- after death

snazziemagee

Help please. My mum passed away with a large equity release loan. The estate has now passed probate and we have received a letter from DWP asking for asset etc in relation to debt recovery in connection with pension credits. My mum had no income and relied on pension credits and equity release to support her living. Can anyone advise on this please? My mum told us equity release didnt need a tax return or effected her application for pension credit?? I have only unpicked all this after her death

Brie

As I understand it equity release is just selling a home bit by bit rather than all at once.  The result either way is to boost ones savings.  And if you have savings that effects PC.  So if she ever had more than £10k while getting PC then the calculation may not have been correct and any overpayment would be flagged by DWP.

Whether any ££ has to be paid back will depend on the size of the estate now that you mom has died.  If she spent it all and there's no equity in the home really left after funeral costs then DWP will need to be told the estate is insolvent.  You would not be responsible to pay anything back.  If there is money in the estate then I believe that DWP would have a claim on it.

from the gov.uk site  Pension Credit: Eligibility - GOV.UK

Your savings and investments

If you have £10,000 or less in savings and investments this will not affect your Pension Credit.

If you have more than £10,000, every £500 over £10,000 counts as £1 income a week. For example, if you have £11,000 in savings, this counts as £2 income a week.

Hoenir

Best to co-operate fully with the DWP. As an executor don't leave yourself personally liable. 

Keep_pedalling

As soon as she released the equity then it becomes savings and that should have been declared to DWP and her pension credit would have stopped unless she was old enough to still have an indefinite assessed income period. 

How long ago did she take out the equity release?