ESA and endowment mortgage maturing

Hi all.
I am in the work group of ESA (income) for the last 3 years, and also receive PIP.
My mortgage endowment policy just matured, and I paid off my mortgage. My policy paid out approx. £19,400, and my outstanding amount on my mortgage was approx. £7,000. My overdraft and credit cards were another £500 or so, leaving just under £12,000.
I called up ESA and told them about my policy maturing, and handed in bank statements as requested. They stopped my ESA benefit from the day I called them a few weeks ago.
I was called yesterday to say they had received all my paperwork, and they would be in touch. The person that called said they didn't think I would get any payment though, as I was over the £16,000 limit. This has left me really worried as I thought paying off my mortgage with an endowment that was taken out for that purpose was ok. What was I meant to do, refuse to pay off my mortgage?
I expected my payments to be reduced as I would have savings between £6 and £16K but I didn't expect to lose everything.
Any advice welcome.
Replies
Thanks wilko. It was an endowment only mortgage, so it had to be paid. I don't think the Halifax would have been happy if I said I wasn't paying them.
I've looked into prepaid funeral plans, but they don't seem to be covered by any financial authority, and I worry the money could be lost if the firm went out of business.
Thanks poppy.
I've found the contact details for my local welfare rights team and will call them in the morning.
You think you are doing the right thing by being honest and it always seems to backfire.
Did you provide them with proof that you spent £7,000 of it paying off your mortgage? Paying a mortgage and debts such as an overdraft aren't seen as deprivation of capital so shouldn't cause you problems. Do speak with the Welfare Rights team in case you need to argue this.
Best of luck and please let us know how you get on.
Scope
If you have a few minutes to spare, we'd appreciate your feedback on our online community.
Thanks Adrian.
That's what I thought too. There was no intent on my part to hide anything. It was me that contacted them to inform them about my endowment.I provided them with bank statements showing where the money went. I spoke to someone at my local welfare rights team at 9.30 this morning and they took my details and will call me back. I will keep this thread updated as I go through this process.
Just to rub salt into the wound my local council have been in touch saying that as I now don't receive ESA I have lost my council tax rebate.
Thanks Poppy.
Good shout on the endowment plan! It says on it is a homebuyers plan with life and critical illness protection.
Thanks poppy.
I'm not paying it off early. It is the full 25 years.
Speaking to the welfare folk person earlier, they think the person that phoned me didn't understand the details. The person that actually deals with this should have more knowledge of the rules, and I should be ok.
Fingers crossed.
Please keep us updated.
Scope
If you have a few minutes to spare, we'd appreciate your feedback on our online community.
Thanks Adrian.
I called the DWP this morning (usual 30 mins on hold), and was told the case is now in the hands of the decision maker and I should hear soon.
Well I got my letter today and they are not paying me any money at all.
I'll have to phone them on Monday for an explanation.
Hi poppy.
No explanation.
"We have looked at your claim again following a recent change"
"You are not getting blah blah blah...……
Phone call on Monday.
Scope
If you have a few minutes to spare, we'd appreciate your feedback on our online community.
I called the DWP again last week, and finally made some progress.
Just checked my bank account, and my ESA payments have started again, along with back payment. Hopefully a letter will arrive today explaining the details.
Thanks to everyone for the support. It really helps when you know someone is there for you.
After contacting DWP and fully informing them of my intention to pay my pension lump sums into paying my mortgage, they rejected my mandatory reconsideration as my savings were above £16000 (which in 2019 is ridiculous as most people of pensionanble age will receive some kind of lump sum, meaning you will automatically have your benefits cut). So you will lose most, if not all your ESA and additional disability premiums, you will also lose your DWP mortgage support loan, you will lose your council tax discount as they work in conjunction with DWP.
DWP's calculation will basically half your benefit and add a premium deduction based on your additional income..you will move to contribution based benefits, where your income and saving are not counted by DWP, but you've lost all or most of your pension income to offset your benefit deductions.
The awful way DWP ESA work is that for some crazy reasoning, they think your disabilities disappear when you get some additional income!!!.
I argued that by paying my mortgage I was repaying a credit agreement and was exempt from DWP rules. DWP say that paying anything like mortgages or debt is a Deprivation of capital....crazy!, they want the sick and disabled to live with debt as a norm.
DWP say paying you lump sums to your lender are indeed Deprivation of Capital, and would not accept that a mortgage is a debt????
Something I argued was that DWP were discriminating against claimants as they will not allow you to repay lump sums to your mortgage lender, but will allow you to pay lump sums to pay back your DWP mortgage interest loan..HOW UNFAIR!
I've passed all this onto my MP, who sees a clear case of discrimination and found the DWP's inturpitation of the welfare act on existing debt to be opposed to the act.
Scope
If you have a few minutes to spare, we'd appreciate your feedback on our online community.
Received my letter, and thought it was fair.
The DWP accepted that my mortgage, overdraft and credit card payments were not part of my left over capital.
Hopefully this information can help someone else.
I notified them months before the pension was due and explained that the lump sum would be paid over as per my agreement with the building society to avoid losing my home, didn't make a blind difference, they would rather see you homeless that use common sense!