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Will paying off my mortgage affect my benefits?

MissVelvetenaMissVelvetena Member Posts: 3 Listener
edited March 2018 in Finances and extra costs
My mortgage term comes to an end at the end of June & I am on ESA & have applied for PIP. If I pay off my mortgage with Equity Release, will it affect my benefits, please? I don't want the DWP getting their knickers in a twist, had enough trouble with them this last three months!! Thanks.
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Replies

  • CockneyRebelCockneyRebel Member Posts: 5,258 Disability Gamechanger
    Hi MissVelvetena and welcome

    Can you clarify please
    Your morgage term ends in june, does this leave you with a capital balance to pay off ?
    Before contemplating any equity release you should get trained financial advice

    PIP is not means tested so will not be affected
    Is your ESA contribution based or income related ?

    CR
    Be all you can be, make  every day count. Namaste
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  • MissVelvetenaMissVelvetena Member Posts: 3 Listener
    Yes, its an Interest only Mortgage, so the capitol is to pay off. My ESA is income based. Getting a phone call tomorrow from Step Change Financial Solutions.
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  • CockneyRebelCockneyRebel Member Posts: 5,258 Disability Gamechanger
    If you are only releasing sufficient equity to pay off the capital I don't think there will be a problem
    If your are releasing some for other purposes then up to £6000 should also not affect your ESA

    CR
    Be all you can be, make  every day count. Namaste
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  • MissVelvetenaMissVelvetena Member Posts: 3 Listener
    Oh lovely, many thanks. :) Was thinking of releasing enough to pay off the capitol & about £3,000 for some urgent house repairs.
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  • CockneyRebelCockneyRebel Member Posts: 5,258 Disability Gamechanger
    Please do keep all records of what you do with the money as large sums do raise questions
    I cannot see that using the equity in your home to repay the capital borrowed, which you have no choice about, can come under deprivation of capital and likewise any amount under £6000 does not affect ESA (IR ) and monies used for essential repairs should also be discounted
    But I don't trust these buggers

    CR
    Be all you can be, make  every day count. Namaste
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