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Is it right that I won't get help from the government if I have money in a property?

claire19

Hello please can someone give me any advice
my partner and me are breaking up and we currently own a house together 50/50 My partner pays for everything so I have no idea how I’m going to support myself and my son. If I have money in the property I won’t get any help from
the government is that right?

Claire

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Comments

janer1967

Hi and welcome to the community Sorry to hear of your breakup

Owning a home doesn't necessarily discount you from claiming benefits . They won't pay towards any mortgage payments but you can still claim other benefits

Are you staying in the property or moving out

A lot depends on your circumstances so hard to advise. Try doing a benefits calculator found in gov website or contact welfare rights for a benefits check

poppy123456

Who's going to be living in the property you jointly own? If it's you then you will be able to claim Universal Credit but you won't be able to claim for any help with the mortgage.

If you're not going to be living in the property then yes it will be taken into consideration if the equity in it is more than £16,000. It can be ignored for 6 months or longer if it's put up for sale.

claire19

I am hoping to stay there with my son but no idea how ill
afford it x

Jamescasali

Hi, I'm not sure if its ok to jump into someones post, so slap my wrists if it isn't, i'm in a similar situation I think to you, except , your post title says "money in a house", if you can say is this "a financial interest" ie you put some money in to lower the outstanding balance , or dyo mean your fully on the mortgage with ex partner ?
Because I bought a house mortgage solely in my name , and my now ex put in a lump sum 3 yrs later reducing the outstanding balance, she has an interest financially but isn't on the mortgage docs.
If your situation is, your on the mortgage docs, then correct, you have to wait 9 months before you can get any help from the Gov, and then they'll only pay the mortgage interest on it, not any money towards the capital, now if its a interest only mortgage BRILLIANT, if not then the smi loan help would be effectively split between you and your ex, with both still liable for the capital aspect of it.( if a joint mortgage)
SMI takes quite a while to get through, dwp , arent as clued up on it as the banks are.

My situation is different to yours in that my ex moved out of the property, and did tell me she hoped the dwp would pay her rent in her new property, personally i'm sceptical about that, because she effectively has 60k in equity, if not on the deeds of a property-- with regard to saving invest etc and the 16k rule, i have no idea whether dwp are paying the rent for her, cynically maybe she applied and just didn't mention the equity, i've no idea what the checks are they do in that respect. everybodies financial situ is different, mine was a mortgage payment of 135 pm cap+interest, and dwp are paying 29 quid a month ie the interest, which being honest, isn't a great help as if i couldn't afford 135, i still cant afford the 105 pm.
I hope i haven't confused you with this LONG post, and i hope its helped even a little

poppy123456

Jamescasali said:

If your situation is, your on the mortgage docs, then correct, you have to wait 9 months before you can get any help from the Gov, and then they'll only pay the mortgage interest on it, not any money towards the capital, now if its a interest only mortgage BRILLIANT, if not then the smi loan help would be

Whether a person is eligible to claim the SMI will totally depend on what benefits exactly they claim. For someone claiming Universal Credit they need to have 9 concecutive months with zero earnings. It's also only a loan, it needs to be repaid back.

https://www.gov.uk/support-for-mortgage-interest/eligibility

Jamescasali

Oh i know its a loan, Poppy, i mentioned it in my post, but a loan that ONLY needs to be paid back if/when the property is sold , and from my exp claiming smi , even after the waiting period it took another 5 months, another thing to consider is your mortgage interest rate , mine for eg fixed for 5yrs at 1.19%, but borrow off the Gov and i believe the interest rate is near to 3%, why? you may well ask why?

So Smi , is a little........ help from Gov , but you pay through the nose for it, all naturally Imo and exp of it, again hopefully helpful to the op

Sue_Alumni

Hi @claire19

It sounds as if you’re having a tough time. I will do my best to give you some pointers. You are not eligible for UC if you have capital over £16,000. If you own the home in which you live its value is disregarded for UC purposes.

You could claim UC as a single person depending on your earnings and other circumstances. You would need to show that you and your partner are no longer a couple to make a single claim for UC. You could claim a child element in respect of your son. Are there any circumstances preventing you from accepting a full work commitment – perhaps your son is young, perhaps you and/or your son have health issues and you are a carer? Have a look at a benefits calculator to see what you may be entitled to. Also contact UC helpline.

I don’t think you will be eligible for a Support for Mortgage Interest (SMI) loan at this stage. If you want to get a loan for mortgage interest you need to be claiming UC and cannot have any earned income and it doesn't take effect, as @poppy123456 says, for 9 months. You would need to show that you and your partner are no longer a couple to make a single claim for UC and you might then be entitled to a loan in respect of 50 % of mortgage interest.

I know you're hoping to stay in your home but it may be that your partner is resisting this and you are finding this stressful as you don't know what will happen in these circumstances. If you are taking reasonable steps to sell your home the capital value is ignored for a period of six months or longer if reasonable to do so. If you sell your home and intend to use the money from the sale towards another home the money is ignored for six months from the date you received the money or, again, longer if reasonable in the circumstances to do so.

If you are planning on selling the house and but do not intend to buy a new property ( or there is insufficient money to buy) and are going to rent, you are expected to draw down on your share of the net proceeds of sale and cannot claim UC until your savings are below the £16,000 threshold. You can claim UC as a single person as detailed above from the date you market and try to sell the property to the date of sale and then reclaim UC once your capital goes below £16,000.

Any child support your partner pays you is ignored for UC purposes. Spousal maintenance is taken into account as income.

Jamescasali

Another thing to perhaps consider is , IF you have a child/children, i'm fairly convinced although not a qualified solicitor, or like the experts here, that no court would make an order that you had to sell the property( force a sale) i think its called, maybe worth getting 30 mins of free legal advice on the subject, ...proper legal advice.... just my 2 pennies worth .

calcotti

Sue_Scope said:..You would need to show that you and your partner are no longer a couple to make a single claim for UC and you might then be entitled to a loan in respect of 50 % of mortgage interest.

It's 100% of the interest up to a capped amount borrowed (usually £200,000), as referenced in the links already provided by poppy.

Sue_Scope said:
I know you're hoping to stay in your home but it may be that your partner is resisting this and you are finding this stressful as you don't know what will happen in these circumstances. If you are taking reasonable steps to sell your home the capital value is ignored for a period of six months or longer if reasonable to do so.

But is ignored completely while it is still being lived in by OP.

Sue_Alumni

Yes definitely try and get some legal advice. I certainly don't know what a court would decide in these circumstances and wouldn't like to hazard a guess. I note @calcotti 's point re SMI loan interest. I didn't know that - thanks