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Original poster

Coming off UC due to house purchase question

56 replies

StrawberryKick · 11/01/2024 20:36

Hi all

I'm a single, full time working parent to 2 DC. I currently receive a small amount of UC because I private rent and pay childcare.

My grandparent recently passed away, their house was sold and my parents have very kindly offered to gift me some of the proceeds (around £20k) as a deposit to buy a house. I was amazed that I could get a mortgage and have had an offer accepted on a small property (we live in a cheap area).

I don't have those gifted funds in my account yet, the solicitor says it's not necessary to do that until we complete in a few months time and I don't have any savings of my own bar a few hundred so I am still receiving UC (around £200 per month).

My question is, obviously I need to come off UC as soon as the house purchase goes through as I know I'm not eligible as a home owner but do I need to tell them exactly why or can I just say I don't want to claim anymore? The amount of paperwork they wanted when I did my claim a few years ago totally stressed me out and I'd assume they would want every single document to do with the deposit and sale. I wouldn't be claiming when the deposit hits my account so wouldn't be claiming anything I'm not entitled to

I'm just trying to spare myself some stress, and money as amazingly the mortgage will be about £300 cheaper than the rent I'm paying!!!

Thanks

OP posts:
Fellatfirsthurdle · 11/01/2024 20:42

Why aren't you eligible as a homeowner?

kweeble · 11/01/2024 20:43

You may well still be eligible - you can check using the entitled to website. Many homeowners get UC.

Gabby10 · 11/01/2024 20:43

First of all- CONGRATULATIONS!! also as a single mum I dream of one day owning a house so happy for you all Smile.
And as for your question, no they won't ask there's a section when you log into your UC where it will let you just close the claim. Not sure on your children's ages but if you are currently getting help with childcare costs through UC don't forgot to have a look at the tax free childcare help and also the new free hours stuff is starting from April, which I promise isn't as many questions and faffing around as UC is 😂 xx

ErikaReadsTheDailyMail · 11/01/2024 20:45

Fellatfirsthurdle · 11/01/2024 20:42

Why aren't you eligible as a homeowner?

You are still eligible.

Persipan · 11/01/2024 20:46

Many homeowners are eligible for UC, so do double check your circumstances. The Gingerbread phone line is really helpful and should be able to advise. Enjoy your new home!

Original poster
StrawberryKick · 11/01/2024 20:47

I didn't think I would be eligible because I would have had over £16k in my account, if even for only 1 day and also because I would have £20k in equity, wouldn't they count that as 'savings'??

OP posts:
Original poster
StrawberryKick · 11/01/2024 20:50

Thanks Gabby10, it's the most exciting and stressful time in my life so far!
I honestly didn't think I would get a mortgage but I do so many extra shifts at work (NHS) the bank took them as an additional, regular income and let me have more than I thought! With the deposit we can finally get our own teeny (easy to heat) forever home

OP posts:
Gabby10 · 11/01/2024 20:50

If it's all being put as a deposit then no it's only if you have over 16K in a bank account for example. Sorry I read it as you only get money to cover your rent x

Persipan · 11/01/2024 20:52

Equity doesn't affect eligibility. The having had the money for a day thing I'm less certain about - chat that through with Gingerbread or another advice service to see what the impact would be and whether any other approaches to the situation are permissable (eg can the money just be transferred straight to your solicitor and bypass you altogether?)

Babyroobs · 11/01/2024 20:53

You will likely still be eligible as long as that 20k doesn't hit your account until you actually near completion date.
You can still claim if you are eligible. Homeowners get a higher work allowance but obviously rent element stops. you would just need to inform them when you no longer have rent costs and if you aren't eligible the claim will just stop although they tend to keep the claim open until you've had six zero awarded.

Babyroobs · 11/01/2024 20:55

StrawberryKick · 11/01/2024 20:47

I didn't think I would be eligible because I would have had over £16k in my account, if even for only 1 day and also because I would have £20k in equity, wouldn't they count that as 'savings'??

Even if you had 20k for a day and your Uc stopped you could easily do a rapid reclaim once the money has gone. you would be allowed to use money for a house deposit and it shouldn't be seen as deprivation of capital. Equity in a house you own is not classed as capital, people own home outright with no mortgage and still claim UC.

Beezknees · 11/01/2024 20:55

You can still get UC. Just obviously not the housing element.

jesper1 · 11/01/2024 20:56

If your patents are gifting the deposit, you will need to complete paperwork that states this. I would think the deposit could go straight to the solicitor from them

Arthurnewyorkcity · 11/01/2024 20:57

Your parents can pay the solicitor directly as a gift. They just sign to say its not repayable and they have no interest in the property :) you may find youre better off as you'll have a higher work allowance. You can still get UC. Don't close the claim

Original poster
StrawberryKick · 11/01/2024 21:02

Oh my goodness I didn't know this!!! I'm so so glad I posted, I thought I would be cut off from claiming.

That's made my day, thanks everyone.
I'll ring gingerbread tomorrow as suggested, they've been very helpful to me in the past.

OP posts:
Choconuttolata · 11/01/2024 21:03

Do it as a gifted deposit for a house purchase, the funds go straight to the solicitor not into to your account. Your parents would have to complete a gifted deposit form or paperwork for the mortgage lender and solicitor and may have to provide proof of funds as part of the offer being accepted.

Choconuttolata · 11/01/2024 21:04

https://www.uceplus.co.uk/disregarded-capital

Look on here for UV capital rules there is a section on money being used to purchase property

Disregarded capital | Universal Credit Essentials

https://www.uceplus.co.uk/disregarded-capital

ColourMeBlue · 11/01/2024 21:07

You can still claim UC.You will get a higher work allowance as you have a mortgage.Look on Universal Credit Survival page on Facebook.Fantastic admin there can work out entitlement for you

SugarPlumpFairy3 · 11/01/2024 21:10

Congratulations! When I split with ex dh and he bought me out of our house, I had about 100k of equity in my bank for a few months.

UC didn’t even ask questions-I just popped a note in my journal as a record. It was never an issue.

purpleme12 · 11/01/2024 21:15

To all those saying the parents can pay it straight to the solicitor, I thought this too but this is not the case.
My parents gifted me money for my deposit (so yes they had to sign the form, do all the checks etc) but the solicitor said I still had to transfer it to them from my account. My parents had to put it in my account then I had to put it in solicitor's account

Fourcandleforkhandle · 11/01/2024 21:16

If the property you are about to buy is the only one you have in your name then you can still get UC. UC only stops if you have any property which you own other than one you live in.
If the 20k is in your account for only a little while and you can prove to UC that you have used the money for a Home purchase then you can continue to get UC.
I would advise you to speak to Citizens Advice Bureau if you can.

Original poster
StrawberryKick · 11/01/2024 21:23

Even more amazing info, I've joined the Facebook page and will be looking at the UC link, so helpful.

As a PP said my solicitor has asked that the funds come straight from my account, not theirs so that's why I was confused, I'll only have the funds for a day or 2.

OP posts:
YouveGotAFastCar · 11/01/2024 21:26

purpleme12 · 11/01/2024 21:15

To all those saying the parents can pay it straight to the solicitor, I thought this too but this is not the case.
My parents gifted me money for my deposit (so yes they had to sign the form, do all the checks etc) but the solicitor said I still had to transfer it to them from my account. My parents had to put it in my account then I had to put it in solicitor's account

That’s unusual and likely specific to your circumstances or solicitor for some reason. It’s really common for gifted depositors to be paid direct.

Original poster
StrawberryKick · 11/01/2024 21:27

Also, I've just realised that if I can still claim UC once I'm in the house I'll be able to apply for the government ECO4 free boiler upgrade, the house I'm buying has a condemned boiler due to its age and I have been quoted £4k to replace and move it, they said they could do it for free if I was on UC but i told them i wouldnt be once I moved in
Things are looking better for us ☺️

OP posts:
purpleme12 · 11/01/2024 21:37

@YouveGotAFastCar OP has said her solicitor has told her the same thing, that it's got to come from her account