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AIBU?

Share your dilemmas and get honest opinions from other Mumsnetters.

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Original poster

owning 2 flats and claiming HB/tc on a council house

93 replies

imjusttosoft · 04/06/2012 21:52

ok ive namechanged

this is a ???? as well as a AIBU

a friend of 8yrs has a council house and lived there for 12yrs,10yrs ago she met her current partner he has a flat in the town we live in and a apartment in spain both let out and were his before he met my friend so all in his name

in the last 5yrs they have had 2 young children and he moved into her council place (thats still only in her name) he is the only worker in their family and works 24hrs a week in a local corner shop

because he works nmw and low hours they claim WTC,TC,HB,CTB

now surely if he has these properties would he be entitled to help as i would of thought rent he recieves would be classes as income??????? and the rent for the property in the uk here would be 700pcm for a start thats without the propert abroad

maybe hes not declaring as it seems strange

and AIBU that if hes got 2 properties he should sell them and free up the council house for somebody that needs it

yes its none of my buisness but it seems very strange that hes got 2 places and their geting HB for the council property,i just dont believe that the council and tc would be paying these amounts as surely rent from his properties would be income

OP posts:

Original poster

imjusttosoft · 05/06/2012 01:00

not that im aware of

OP posts:

sadsac · 05/06/2012 01:29

Could be legit. Could be that mortgage is more than rent. They'll be wealthy pensioners but in the meantime, no income.

DioneTheDiabolist · 05/06/2012 01:38

If they are getting WTC then they must be declaring that they are together. No?

Original poster

imjusttosoft · 05/06/2012 01:46

yes they are declaring together that im sure,the ????? really is has he declared properties as surley these would be income/asset/equity for HB.CTB purposes

OP posts:

Noqontrol · 05/06/2012 02:34

Not necessarily no. I know someone in a vaguely similar position and they are allowed to claim whilst having mortgaged properties that they rent out.

Lougle · 05/06/2012 07:38

The way it works is this:

House 1:

His main residence. If he rents it, and his income is lower than his 'applicable amount' (that is, the amount that the govt has said a person with his family make up should need to live on) then he is entitled to HB.

House 2 & 3:

Value of Property from Valuation Office Agency - 10% for future sale costs - value of mortgage - any financial charge (debt) secured against the home.

If those values total less than £16 k, then they are entitled to HB, but it will be reduced by £1 for every £250 over £6000.

After £16k entitlement stops.

If he has two rentals, however, he should be registered self employed, in which case, rather than just looking at capital value, they'll look at the profits. He can offset mortgage payments, buildings insurances, costs from deposit bond schemes, agency fees, wear and tear/maintenance, etc., from his income, so may well be earning under the threshold for HB.

EdgarAllenPimms · 05/06/2012 10:26

to clarify: if it is a repayment mortgage, only the interest payment portion can be claimed as an expense. repayments not deductable.

for a furnished let, there is a 10% wear and tear allowance

Original poster

imjusttosoft · 05/06/2012 13:51

thanks for replys,so it sounds possible then

OP posts:

tittytittyhanghang · 05/06/2012 14:50

Are you sure they are getting hb? If he is working 24 hours in a low paid job and she is not, but claiming as a couple with a child, even taking into account some rental income, they possibly would still be entitled to wtc/ctc. (My brother in similiar situ, him and his dp moved into rental and let out their house which was mortgaged, and they legally claim wtc/ctc). However, with wages, wtc and ctc I know my db is not entitled to hb, and pay full rent (which is quite high being a private rent). If your friend is in a council/housing assoc, then they are probably not getting hb but just paying the lower rent?

WhosPickleisThatOnion · 05/06/2012 15:00

Yeah I would say its a possibility they are legit.

Its a tricky one op.

FlangelinaBallerina · 05/06/2012 15:24

Yeah, it's a possibility. Even if he bought several years ago, it isn't implausible that he's got virtually no equity. It would only take a poor decision or two. Especially as the Spanish property could easily be in negative equity. There are some properties in the UK that wouldn't really be worth more now than in 2002ish. Location would make a big difference- if it's in Central London then no, but if it's somewhere hit badly by the recession, absolutely. Assume for the sake of argument that he's not maintained it that well, it's had a bit of time empty and he's been on interest only for some of the mortgage period and I can quite easily see how he has nothing to show for it.

Of course, he could be wadded and taking the piss also. That's the thing with property portfolios these days. They can still be making the owner a nice sum, or losing them money daily.

zeeboo · 05/06/2012 17:44

For Gods sake, report it. You'll either be totally wrong and the council will already be aware, or it'll fail the risk assessment OR it will be investigated and the claim corrected with possible action taken against them.
It will take you less time than it did to write your OP.
I don't get the point of threads like this????

thatisall · 05/06/2012 18:02

This is fraud! Not all people who claim benefits are like this and these people give others a bad name.

Report them!! If they aren't doing anything wrong then nothing will come of it....but if they are, you will have saved the country 1000s of pounds no?

thatisall · 05/06/2012 18:04

also Im fairly sure that if you own a property, you can't claim housing benefit on another...might be wrong

york67 · 05/06/2012 18:19

My fear would be for the woman aswell. I know someone who claimed JSA and was taken to court as she declared her partners savings incorrectly. She obv went on info she was told. It was she who was taken to court and not her (d)p.

thatisall · 06/06/2012 00:46

yes but it all gets sorted out...frankly if the op knows that the man has two flats, then the woman in question does too.

I had to claim benefits for 2 years after ill health caused me to eave my job....I hated it. I met my partner during this time and I git reported because someone saw him let himself into my house with a a key. Yes I had given him a key, because he fed my cats one weekend while I was away and I just didn't take it off him afterwards.

We had only been together only a few months and when I was questioned, which I very much was, and I wasn't ready to have him move in. I was honest and explained the situation. I of course had to show proof that we didn't live together and was given slapped wrists as him having a key or even visiting too often was a grey area apparently. I am now back at work and we are married so alls well that ends well :-)

My point is, yes I was pissed off that someone reported me knowing that I might be taken to court etc, but the fact is we are lucky to have a benefit system to catch us when we need help, it shouldn't be misused. Where there is a chance that it is..reporting someone who isn't doing anything wrong, won't get them into trouble. Yes it may seem like it does when they are being questioned etc, but if the woman KNOWS that the man has these properties, this money then she knows full well she isn't entitled to the help she is getting.

If you report her and you are wrong, nothing will happen to her other than a few embarrassing, annoying questions.

Birdsgottafly · 06/06/2012 00:54

It can be legal.

Iknow of a woman who rents out her house and has been allowed tostay in her deceased mothers house and buy it on her discount.

She claims in work benefits, as she has negative equity on her house and no profit.

If his flat is not big enough for them to live in and there isn't enough equity for a deposit on a house, i don't see why anyone would resent them having a house.

Either way someone wil be made homeless, either them or their tenant.

thatisall · 06/06/2012 00:58

It isn't always about resentment though. These are hard times and its understandable that people are nary when they see what they believe to be someone flouting the 'system'.

If is all legal and above board then a few questions will be the beginning and end of any investigation won't it?

Birdsgottafly · 06/06/2012 01:03

It won't be 'a few questions' they will want to go through everything and it will be very stressful.

If they were flying out to Spain every few months, it would be different.

Why is the OP kidding herself that this is a 'friend'? This isn't something that you do to a friend with young children.

There might be a waiting list for housing but whose to say that those on the list are anymore 'deserving'.

thatisall · 06/06/2012 11:51

so people shouldn't speak up when they believe someone is committing fraud because it might be upsetting? Is that what you're saying birds

Birdsgottafly · 06/06/2012 12:05

No, i am just pointing out that you don't suddenly report a 'friend' of 8 years because you believe in upholding the law.

If the OP is going to do that then at least be honest with herself, she has sat and let this happen for at least 5 years without question.

What has now changed?

It would have been better to have done this before they had two children, so that they could have moved into the flat without it impacting on the children.

OutragedAtThePriceOfFreddos · 06/06/2012 12:05

It might be stressful but that is the drawback of having to rely on the state for money.

Going to work and earning your own money is a pain in the arse for many people, why should you be exempt from any stress just because you are on benefits? A possible investigation just goes with the territory.

Yes it would be worrying for them to go through an investigation, but no more worrying than it is for people who are facing redundancy.

OP, just report it, and leave the descison about whether it's fraud or not to the people whose responsibility it is to determine these things.

AKE2012 · 06/06/2012 12:08

Id contact th council. You can do it without your friend finding out. I think thats quite cheeky. I hate people who have councils houses and dont need them. They clearly dont need the house never mind the benefits.

Birdsgottafly · 06/06/2012 12:18

Just because he owns a flat doesn't mean that they don't need the house, the flat might be one bedroom with negative equity, if it would sell at all.

It could be above board, the OP just needs to stop kidding herself that this is a 'friend'.

The friend is recieving in work benefits.

WhosPickleisThatOnion · 06/06/2012 12:30

I can see both sides here I really can. If it was a good friend I would talk to them about it and say your concerned she will be found out and face a fine etc. I would try and find out first.

That's what I would do but appreciate there are strong feelings if it's fraud.

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