Father lost benefits because i bought the house he was living in

manz

Hi,
i live with my parents.
My father got into some debt in 2005.

So get rid of the debt i looked into buying the house off my dad.
Before i bought the house, my dad was recieving £300 towards the mortgage which was help paying it off.

My dad asked the Department of Social Security to enquire if his son (me) purchased the house off him, would he still keep the help towards the mortgage.

I also sought advice from the Financial advisor i was liaising with.
So i bought the house on the premise that the money would remain and would help to pay off the mortgage.

My father then lost the money he was getting per month.
I was told that becuase the house was in my name and my father was living with me he could not claim.

Questions

1. is there anything i can do about it?
2. Can my father get the money back he was getting before?
3. If the house was transferred into some one elses name, can my father recieve the money again?
4. Is there any place i can go for advice?

Because of my father not getting the money he said he would get i am now in debt and am surviving on credit cards and have had to re-mortgage the house to clear them off. The credit cards are now rising again.

I would be grateful if you have any information or advice.
Please email/respond if you have any suggestions.

Thank you for any help you are able to provide.
Regards
Manz

dmg24

Hi Manz,

Welcome to MSE.

The DWP are correct, your father is not able to claim ISMI for a property in someone else's name. He would also have difficulty claiming HB, as the tenancy is not based on a commercial agreement.

TBH I think if you transferred the property into someone else's name, he may still have difficulty claiming HB as it would be seen to be a contrived tenancy (you created the situation in order to become eligible for benefits).

The other issue is that it is not possible to claim HB for a property that you have owned in the past five years. The exception to this is where the property was sold to avoid losing it, however this is unlikely to apply as he was not going to lose the property as the mortgage interest was being paid for him.

Sorry I can't give more positive news x

Penny-Pincher!!

manz wrote: »

Hi,
i live with my parents.
My father got into some debt in 2005.

So get rid of the debt i looked into buying the house off my dad.
Before i bought the house, my dad was recieving £300 towards the mortgage which was help paying it off.

My dad asked the Department of Social Security to enquire if his son (me) purchased the house off him, would he still keep the help towards the mortgage.

I also sought advice from the Financial advisor i was liaising with.
So i bought the house on the premise that the money would remain and would help to pay off the mortgage.

My father then lost the money he was getting per month.
I was told that becuase the house was in my name and my father was living with me he could not claim.

Questions

1. is there anything i can do about it?
2. Can my father get the money back he was getting before?
3. If the house was transferred into some one elses name, can my father recieve the money again?
4. Is there any place i can go for advice?

Because of my father not getting the money he said he would get i am now in debt and am surviving on credit cards and have had to re-mortgage the house to clear them off. The credit cards are now rising again.

I would be grateful if you have any information or advice.
Please email/respond if you have any suggestions.

Thank you for any help you are able to provide.
Regards
Manz

(1)Basically No
(2)No as the property is no longer his.
(3)It would need to be in your fathers name for him to receive help, but he would have to wait the 39weeks (I think or longer)
(4)CAB, but I think they will say the above

Is he getting all other benefits his is entitled too? Do you have any proof from the DWP about what they said

PP
xx

mitchaa

Not sure why the DSS and financial advisor would have said this was okay

I very much doubt you'd be able to sell it back to him as he is on IS and wouldn't get a mortgage now.

As for HB, he wouldn't be allowed due to family attachment.

Not being funny, but why should the government pay off your mortgage? Your dads mortgage, fine, as he is on IS, but why would they pay yours off? Its ridiculous to even think they would.

Conor_3

1) No because it was based on your father being the mortgage payer.
2) No because it was based on your father being the mortgage payer.
3) No because it was based on your father being the mortgage payer.
4) CAB who will tell you no because it was based on your father being the mortgage payer.

Do you see a pattern forming? It is a benefit to help someone claiming income support to pay their mortgage. That's their mortgage, not anyone esles or anyone who buys the property. You could transfer the property into someone elses name and then charge him rent but then you'd have to have a commercial mortgage as personal ones don't allow for renting of property.

It looks like you're going to be paying for the house.

manz

Hi everyone,
thanks for your advice.
It is much appreciated.
I made the mistake in buying the house to help my parents but i need to move away to get on with my life.
Hence all the questions.
But thanks anyway for your replies, i thought it may be worth a try.

I just thought there might be a way to improve the situation i am in.

It is not what i wanted to hear, but i suppose thats what happends when you make a mistake.

Regards
Manz

Conor_3

I'm sure your parents don't see it that way and appreciates what you've done for him. It's just unfortunate that you didn't look into all the pitfalls first.

manz

I would like to ask another question.

If i bought another house and showed that my father was renting the house off me.
I would be gratfeul if you could provide some insight on the following questions:

1. Would he be able to get assistance with the rent as he is on IS?
2. Also, how would i prove that my father could not survive on IS? Which would help justify the help needed for the rent.
3. Would the HB/IS guys provide help with Rent to my father?
4. What would my father need to show or prove to be elligible for the help?
5. Also how far would i have to live away from my father to show that he is renting the house off me?
6. I am thinking of buying a house in Sutton Coldfield is that area to close?

Thank once again for your help.
it is much appreciated.
Regards
Manz

dmg24

The issue that you have is that you cannot claim HB when you rent from a relative, unless you can show that there is a commercial agreement in place. I think you would have real problems showing a commercial agreement.

DaisyFlower

If you cant afford the payments on the house you own already, how are you proposing to finance another?

seven-day-weekend

For a relative to be able to claim HB on a house that belongs to you, you have to show that it is a commercial enterprise and not a 'contrived' tenancy just set up so your dad could claim.

You would have to be able to show that the house has been bought to rent (maybe with a btl mortgage, ot permission to rent on an ordinary mortgage) AND that it had been rented on the open market before your dad came to live there, and would be rented on the open market were he not living in it.

I managed to show this for an investment flat that my son lived in (in the late 1990s) and he was able to claim HB.

I showed the Council my mortgage agreement with persmission to rent on, and had an estate agent certify that the flat had been advertised for rent with his agency in the past.

That, afaik, is the only way they will do it. It has to be a genuine business transaction.