Pension Credit Question

[Jean Brown]

Hello

I wonder if anyone else has been in a similar situation or can give any advice.

My 84 year old mum has lived all her life in what was our family home, she had a small mortage of 10k and was in receipt of pension credit and council tax benefit. As her health was starting to suffer my brother and myself made the decision to raise a mortgage and buy her a small bungalow so that she could be near us and we could take care of her. Mum would never have stood the stress of selling her home first so we bought the bunglalow, did some necessary alterations to it and moved her in. We then put mums house up for sale, we were lucky enough to sell quickly and we should complete at the end of the month. The proceeds of the sale will be sufficient to pay of the mortgage my brother and I have on the bungalow although there will still be about 10k left on the mortage in the end. I am concerned that DWP may look at this as deprivation of capital and mum will lose her pension credit, although this is certainly not the case and the only possible way the move could be made, Can anyone advise - many thanks

[honeybee13]

Hello and welcome to CAG.

 

I'll move your thread to the benefits forum here and hope the guys will be able to help you. I'll send you a link to it by PM.

 

My best, HB

[MIKEY DABODEE]

Did you mum claim help with the mortgage from Pension Credit?

Normally when someone owns a property and sells it to move into a new property, the Department will ask to see completion statements, to show the full amount of capital left after the sale of the house. If she bought a new house and used the proceeds then they would be no problem, but you state the house she has moved in to has been bought by you and a brother, and after the sale of her property you will pay the mortgage of on the new property

Two questions, whose name is the new property in and how much capital will be left after the sale. .

If the property is in your name then they may be a problem,

When you report the change it all will have to be looked at. Maybe seek some help and advice from CAB or Welfare rights

[Jean Brown]

Hi

Thanks for your reply, mum does receive some help with interest on the 10k mortgage she currently has, until the sale goes through. The proceeds of the sale of mums house will not cover the costs of the new bungalow, works completed on it and legal fees etc. we will be left with a small mortgage which we will cover between the three of us. The bungalow will be in mine and my brothers name, there was no alternative as mum could not raise the money to buy it. We are not trying to claim any increase in benefit but just keep her the same pension credit and council tax benefit she receives now.

 

Thanks for taking the time to reply - much appreciated

 

Regards

 

Jean

[MIKEY DABODEE]

I think it will go to a Specialist Decision Maker, even though I see clearly what you have done to help your mother, she has in effect sold her property and used the proceeds as a deposit all be it a large deposit on a property that belongs now to you and your brother, even though she is living in it.. Is she on the Deeds of the property?

I cant begin to tell you what the decision on the property will be. Its a good job she is completing the end of this month as mortgage interest can only be paid on the property if she is actually living in it.

When you ring and notify them the change of address, they will ask for the completion statements etc, keep all receipts etc for works carried out on the new bungalow, they will ask to see these. You will have to notify housing benefit as well, but I dont know how this will effect, I am sure your solicitor can give extra advice if necessary.

I hope she is happy in her new home and the SDM decison goes well for you....

[rebel11]

Hi Jean

 

Your title has been changed, so the guys know what the thread is about.

[Jean Brown]

I think it will go to a Specialist Decision Maker, even though I see clearly what you have done to help your mother, she has in effect sold her property and used the proceeds as a deposit all be it a large deposit on a property that belongs now to you and your brother, even though she is living in it.. Is she on the Deeds of the property?

I cant begin to tell you what the decision on the property will be. Its a good job she is completing the end of this month as mortgage interest can only be paid on the property if she is actually living in it.

When you ring and notify them the change of address, they will ask for the completion statements etc, keep all receipts etc for works carried out on the new bungalow, they will ask to see these. You will have to notify housing benefit as well, but I dont know how this will effect, I am sure your solicitor can give extra advice if necessary.

I hope she is happy in her new home and the SDM decison goes well for you....

 

Hi

 

Many thanks for your advice, mum's name is not on the title deeds but we would be happy to put it on if you think it would help our case, we understand that she will not continue to receive any further help toward the mortgage interest, and we are not asking for any increased benefits, just to keep the pension credit and council tax rebate?

 

Regards

 

Jean

[MIKEY DABODEE]

I would say that if maybe her name is on the deeds and her share in the new bungalow equals the size of the deposit she put down after the sale, then it may be looked at that she used the proceeds of the sale of her old property to buy a new one, and as she is unable to raise a mortgage herself on the bit that was left then you and your brother helped her. As she used her capital up from the sale of her property to buy a new one then this may be ok and she could be fine.

It would still go for a decision to a DM though..

[Jean Brown]

I would say that if maybe her name is on the deeds and her share in the new bungalow equals the size of the deposit she put down after the sale, then it may be looked at that she used the proceeds of the sale of her old property to buy a new one, and as she is unable to raise a mortgage herself on the bit that was left then you and your brother helped her. As she used her capital up from the sale of her property to buy a new one then this may be ok and she could be fine.

It would still go for a decision to a DM though..

 

Hello again

 

I have spoken to pension credits today, although I did not quote my mums details, the advisor told me that as mum is over 80 and her guaranteed pension credit includes an 'indefinite assessed income period' then pension credit are not interested in her capital, he even said that if she inherited money or won the lottery she need not tell them....as it would make no difference. Sounds a bit too good to be true and in a bit of a dilemma as to if I should tell them or not!

 

What are your thoughts

 

Many thanks for your help

 

Regards

 

Jean

[MIKEY DABODEE]

Hello again

 

I have spoken to pension credits today, although I did not quote my mums details, the advisor told me that as mum is over 80 and her guaranteed pension credit includes an 'indefinite assessed income period' then pension credit are not interested in her capital, he even said that if she inherited money or won the lottery she need not tell them....as it would make no difference. Sounds a bit too good to be true and in a bit of a dilemma as to if I should tell them or not!

 

What are your thoughts

 

Many thanks for your help

 

Regards

 

Jean

 

Didnt know she had indefinite AIP

 

No increase in saving has to be reported to Pension Credit so it shouldnt effect there

 

but housing benefit it may effect. They may ask what happened to the proceeds from the sale of the old address. Maybe check with Welfare Rights or Cab

 

If they do question and she can show she sold one property and bought the other then again she may be ok

 

http://www.carlisle.gov.uk/advice_and_benefits/benefits/housing_benefits/benefit_calculations/capital.aspx

 

usaually after the sale of a property a disregard of twenty six weeks is given on the capital if the customer intends to purchase a new property..

but I will be honest I dont know if there are specific rules for Pensioners

Edited May 17, 2012 by MIKEY DABODEE

[Jean Brown]

HI

 

Assuming the advisor at pension credit is correct he said that if she still qualifies for her pension credit she is automatically exempt from council tax so I guess we just keep our fingers crossed. I have already advised pension credit of her new address and they sent her award notice there, bearing in mind she doesnt have to declare capital would you still tell them her old house has sold or not?

 

Your help is much appreciated

 

Regards

 

Jean

[MIKEY DABODEE]

You should always tell any department of a change in circumstances, if she has already moved then they should have stopped paying the mortgage on the property any way, with the AIP in place they shouldnt worry about the capital from the sale. Its on the record then you told them.

 

But with regards to your HB, I know she should automatically qualify with pension credits but you will have to claim HB for the new address and they will ask what happened to the prevoius property as they would have been aware she owned it. So they will ask about the sale I am sure.

Has she claimed HB for the new address

Edited May 17, 2012 by MIKEY DABODEE

[Jean Brown]

Hi

 

Thanks for your reply on the pension credit, i feel better about that at least.

 

She has be granted a full council tax rebate on the bungalow, but you are right I am sure that in due course they will query it

 

Regards

 

Jean

[MIKEY DABODEE]

hi Jean,

You have done a wonderful thing for your mum and it has made her life a lot easier for her,

and am sure you want the best for her, she is very lucky,

 

but if she isnt entitled to HB its not the end of the world for sure

 

take care

[Jean Brown]

Hi

 

Exactly, we did this for all the right reasons, she is very happy, safe and comfortable and will hopefully be able to live there for the rest of her life now we

are close enough to care for her.

 

As you said if she is able to keep her pension credit, HB is not the end of the world and maybe they will view it sympathetically.

 

Thanks again for all your advice

 

Regards

 

Jean

[MIKEY DABODEE]

sounds an ideal situation, must be a worry taken off all of your shoulders,

all you can do is wait and see if HB get in touch then

who knows?

Edited May 18, 2012 by MIKEY DABODEE