House sold do i have to pay anything back to dwp?

[jules9906]

My brother due to mental illness has been on long term sick since 1989, DWP having been paying the interest on his mortage. He has now sold his house. Does anyone know if he has to pay back money to the DWP, there is a shortfall on his endowmentand he will come out with very little equity. If he has to pay back to DWP how can I be sure that he is being treated fairly, I would appreciate any guidance. Thank you all.

[antone]

He does not have to repay mortgage interest payments to the DWP, no.

 

If his equity is more than £16,000, it may affect any means-tested benefits he receives, although this is a complex area of the law.

 

On edit: I'm working here on the assumption that he's receiving Income Support, IB or ESA on the basis of inability to work, and that's why he's had MI payments made to his lender on his behalf. If this isn't the situation, you'd need to tell us a bit more - what benefits does he receive, for example?

[jules9906]

He does not have to repay mortgage interest payments to the DWP, no.

 

If his equity is more than £16,000, it may affect any means-tested benefits he receives, although this is a complex area of the law.

 

On edit: I'm working here on the assumption that he's receiving Income Support, IB or ESA on the basis of inability to work, and that's why he's had MI payments made to his lender on his behalf. If this isn't the situation, you'd need to tell us a bit more - what benefits does he receive, for example?

 

Thank you for replying so quickly to my thread.

 

My brother receives DLA. IB and income support. We sadly lost our mother earlier this year and she willed the house between her 4 children with the proviso that my brother could live there for as long as he wished, this is why he has has sold his house. After costs etc the equity from sale should be approx. £25,000. When the house was put on the market we enquired of DWP if anything had to be paid back but they would not commit to a % of pay back but certainly gave the impression that they would expect to be paid some of the equity.Any light you can throw on this grey area would so greatly received.

[Nystagmite]

His DLA won't be affected. There's something about the money being ignored for x months if the intention is to buy another house.

[Nystagmite]

His DLA won't be affected.

[jules9906]

My brother will not buy another house but will live in the house which my mother has left to us. Any idea what DWP will do about this?

 

His DLA won't be affected. There's something about the money being ignored for x months if the intention is to buy another house.

[antone]

If he's not buying another house then the DWP will probably treat his equity as capital. This won't affect DLA, but it would affect any means-tested benefits such as IS. A person with more than £16,000 in capital is not entitled to these benefits.

 

The mortgage interest payments made to his lender count as part of his benefit from the DWP point of view - they're not relevant to the situation and the DWP can't ask him to repay them.

[jules9906]

Thank you so much for this information, I have trawled the internet looking for the answer. Is this based on DWP latest policy? I assume so.

[MIKEY DABODEE]

If the house is aleady sold, your brother needs to make a call to his benefit centre state that he has sold the propety and has capital of 25k after the sale.. The claim will then be suspended, he can also do a change of address, he will then be asked to send in copies of completion statements to include bank statement showing the date the money sale of the house went into the account. The claim will then close from the date the 25k went into his account. If he has been paid past this point then they may be a small over payment of I.S.

If he is in receipt if IB the capital will not effect this money and he will still receive this benefit.. But if he was IB credts then his benefit will cease as he would have been on full I.S.

The mortgage interest will not be recovered. This is the policy now

If he doesnt inform the dept and they keep paying the mortgage, this sometimes happens then they will be an overpayment and this will be raised.

[antone]

Thank you so much for this information, I have trawled the internet looking for the answer. Is this based on DWP latest policy? I assume so.

 

The capital limits for means-tested benefits are set by Parliament, not the DWP. The fact that the interest payments are not recoverable I'm less sure about - I mean, I know it's the case but I couldn't tell you if that's law or policy.

 

If you want to independently verify advice you get here (a wise idea - we do our best but we are fallible ) then a lot of the guidance to processors is available by searching the DWP website. Hint for this is to use google rather than the site's own search function. Go to the google homepage as type something like "site:dwp.gov.uk income support capital decision makers guide" (without quotes) and see how it goes. Searching the DWP site is annoying, but very often the information is there - buried under a ton of stuff you don't care about.

 

Edit: most other search engines offer a similar function if Google is not your preference.

Edited November 15, 2011 by antone

[jules9906]

A big thank you to all of you who have replied to my thread, plenty for me to digest and research. I will update my thread

Once there has been progress. You are doing a fantastic job helping people.