To think being able to use housing benefits as a mortgage is unfair?

I can't see it happening but it does seem unfair on private renters and those who own but are on small incomes.

If two families both have the same income but one family claims housing benefit while the other has a mortgage does it mean that the family who were claiming housing benefit will still be able to claim it while the family that already owned wouldn't?

Has anyone linked through to the other thread about house prices, and put the pieces together yet?

What happens to the squeezed middle, who get nothing given to them by a nonexistent bank of mum and dad, if everything gets given to those on benefits too? We have already been exploited by both sides for years.

This is exactly the kind of policy that New Labour tried - itself a follow on from the Tory right to buy; giving good public money away to trendy groups. It. does. not. work. Economically it bankrupts the country: socially it rewards the wrong people.

Those of us in that squeezed middle are already sick to the back teeth of paying for everyone else for the last two decades while watching the value of work fall.

Gove this morning wouldn't say how many people it would benefit, only that they were going to discuss with housing associations. I suspect it's a very tiny number of people that will actually be helped by this, they need some popular policy and they are trying to look like Thatcher with right to buy, only back then housing was more affordable and council houses quite easy to get without the income criteria we have now. It's nonsense and I suspect will have the effect of upsetting more people than it impresses. To me it illustrates how they have absolutely no clue about housing challenges faced by millions in private rented accommodation.

so 2 scenarios:
option 1 person gets £800 benefits to rent a property. That’s paid to a landlord who pays a mortgage with it so that they eventually own multiple homes. .
option 2 person gets £800 benefits and pays their own mortgage with it. So they eventually own their own home.

honestly I think option 2 is a better and fairer option and reduces inequality. The problem is owning your own house comes with a lot of additional upkeep so whether it is viable I’m not sure. personally I think we need to totally reform the benefits system and make work much more attractive financially.

Right, but I still think ( hope) the banks will put a stop to it or at least advice the government as to why it's a bad idea! You never know. Maybe lessons learned from 07/08 ?
The post below is very honest !! Not often a land lord or lady is willing to say how it works for them.

The whole scheme is senseless. No bank is going to lend to someone on such a low income unless the deposit covers a high percentage of the value. The government will have to underwrite these deals haha.
Also there are already big problems for people who bought under rtb and now can’t afford the ridiculous service charges etc that the leaseholders (council or HA) put on.

PSA- directed at a range of people on this thread- not necessarily the OP. Noone in the UK is getting rich off benefits, they’ll be lucky if they get fed, clothed and sheltered off it.One of the least generous benefit systems in Europe

It’s bad being poor in the UK, and plenty of poor people are working just as long and hard (probably longer and harder) as the rich people. If you doubt that, have a quick chat with a nurse who works night shifts at a hospital and compare notes. The people on real benefits are the are the richest, I don’t blame them either really, they pay the tax they’re asked to pay and use the loopholes available to them- anything else would be financially irresponsible from their perspective.

If you think you’ll be better off on benefits, have at it! Life is short, it’s not very fair - maybe stop expecting it to be, noone will give you a medal for not taking more than your fair share. Certainly not this government, who let’s face it, are just the worst.

There’s no way Boris ran any of this policy past anyone at a bank, the Bank of England, Treasury or FCA. There are reasons there are minimum lending standards and those reasons mostly revolve around not wanting to bail out banks again.

I agree with one of the first posters that this is just distraction and won't help many.

But say it was a possibility. I rent my house out to a young working family who get some universal credits. I don't know the details of how much is for housing etc. They pay me £650 a month and my mortgage is just over £300 a month. Why would it matter that they could have their own mortgage? Currently I am profiting off the benefit and not them.

The Natwest already include universal credits payments towards the affordability calculation so they will get this past the banks. This will basically mean that extra money will be available to put into the affordability calculation people will be able to borrow more. And we all know what that’s gonna do to house prices.

So yes, it may to some seem unfair, but it benefits the majority.

The crazy housing market as it now benefits very few. It's stupid people have so much of their income tied up in mortgages/rent. Think of how much more productive the economy could be if this money wasn't tied up in housing.

It's only a few people who will benefit from this , most of the council housing has already been sold off anyway. Most won't get past the banks and maybe only one or two people would be eligible. The system is screwed , I heard two people on the radio today who are far more knowledgeable than I'll ever be say this too! Actual experts.

Years ago a couple on benefits took out a mortgage to buy their council property. I know because I did the paper so if it was possible 25 years ago maybe it is possible now.

Not sure it is although a good idea for people that are on social housing lists

It makes no difference to the cost whether HB is paying for a new mortgage or an existing one though, does it? Or to the fact that public money is helping someone buy a house. Why would you consider one ridiculous and not the other?

It has been done for no other reason than to prop up the housing market, if you keep first time/bottom of the chain purchasers in plentiful supply all will be well, as soon as people at the bottom of a chain are unable for whatever reason to purchase, the whole market goes.

So yes, it may to some seem unfair, but it benefits the majority.

DH and I also claim benefits because he is too disabled to work and I am his carer. We own our home outright after many years of mortgage payments. Don't let the bitter and twisted posters on this thread get to you and don't feel guilty.

So you work and you earn above the threshold for benefits.

Other people don't!

And, as an adult, what is "fair" when it is at home?

Of all the things announced today that is the probably the most ridiculous to focus on!

I’m not against it in principle as trying to own is ok. But I don’t know enough about HB or savings and how it will work but the LTV rate makes me think of the recent crash and why mortgage rates had stricter criteria

I’d need more info on risk of default

Cross post!

I do think people should be able to claim towards their mortgage. Otherwise it's all going towards landlords' mortgages, which everyone seems fine with.

My cousin had a stroke in his late 30s, shortly after buying a house. He was in hospital/rehab for months and unable to work for about 3 years. He couldn't claim housing benefit towards his mortgage, so ended up having to move back into rented accommodation. The rent was more expensive than his mortgage payments, but he could claim HB towards it.

He's now back at work, still paying a lot in rent (now without UC) and unable to afford a deposit to buy again.

All because the government were happy to pay off the mortgage of his landlord - a rich man who owned around a dozen BTL properties - but not of a regular person who had fallen on hard times.

It's an ill thought out scheme anyway - sub prime mortgages anyone?

This is a chunk of populist meat thrown to the masses to a) detract from everything that is going on; and b) to pit one section of the population against another. Sadly it seems to be working in some cases.

Fanny May and Freddie Mac. Also known as subprime lending. It was the trigger for the last recession in 2007/8.

I claim benefits because I cant hold down a job due to my disability and I feel very guilty that other people are working to keep me alive. Im sorry

Wasn't this done in USA...Fanny mac mortgages..something named like that..most defaulted after a few years and lost their homes.....

Another expert on with Eddie Mair lbc radio just now , he was overly cautious about it all and admitted it's more about the soundbites than any actual workable policies
Plus many won't benefit either as they are renting in private rentals , they are overlooked.