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

[blahloney]

I’m actually feeling quite annoyed. I currently work full time, don’t receive benefits but cannot afford to buy a house despite my rent being more than a mortgage. How is this fair?

Have you read the news this afternoon?

TL:DR So this is the big fat bribe Johnson is going to offer in the hope of grabbing enough votes as he continues to turn the U.K. into a kleptocracy. We all knew it would have to be a big one.

It is never going to happen, nor should it. I say this as someone who could take advantage of this offer as it stands. It is not workable and is very unfair.

He did stress that it would ONLY be for people in work.

Would existing mortgaged people who fall on hard times be eligible? I know they can atm get some help for a very short period of time but only on interest only mortgage payments.

He suggested an ISA that wouldn't be subject to the UC savings eligibility of £16,000.

If you are earning so little that you need housing benefit, how long would it take you to save up £20,000 deposit?

Even if you managed to overcome these hurdles, what happens if you get sanctioned by the DWP, do you lose your house? What happens if you need a new boiler/roof/windows etc, all big expenses.

All this announcement is for is a distraction from his appalling mismanagement of the country and as a bonus, more benefit bashing.

Divide and rule once again. Why do people fall for it over and over again?

It means that gov pays out less housing benefit and that more housing benefit goes directly to banks instead of councils and private landlords. It's just streamlining cash to the people that matter to the tories, no? You'll still keep voting for them to spite the people poorer than you though. 🤷‍♀️

Sorry if I missed someone quicker off the mark saying this, but it will never happen because Conservatives have already ensured that benefits are not a stable or reliable income with sanctions, badly administered UC and in the case of disability benefits just suddenly having them cut off well before the stated end date because someone in the DWP or assessment centre had a quota. No lender would accept that level of inherent instability.

I do think it makes sense for homeowners who lose their job / become disabled / suffer a relationship breakdown to be able to claim the same housing element of UC as someone in the same situation but who rents. If for no other reason than if that person loses their home it ultimately costs the taxpayer more!
I’m not so sure about it as a right to buy type scheme, as we need more social housing in this country, not less.

It's true what someone said in the DM comments pages, if any of this had been Jeremy Corby's idea the Mail would have wanted his head on a spike! All relative I know , but they are not wrong.

The banks will not stop it the banks have just been handed a whole new set of customers that they didn’t have previously, why would they think that was a bad idea ?

just thinking within my own family my cousins been renting a council house for years she wouldn’t buy because it’s in a shit area and she doesn’t want to be there long-term. But if she can take the universal credit top ups that she’s gonna get for the next 10 years until her children leave home and put them towards buying a property in a decent enough area she most definitely can cobble together a 5% deposit she’s a nurse so she’s got a good solid salary. This will be great for somebody like her.

she will inherit in 10 years time I would imagine and that will help her to clear her mortgage in the long term, it just means that she’s gonna get ahead of the game quicker and pay less money out in rent in the short-term.

As a double whammy in my cousins case getting her out of that council house that she doesn’t want is a win for somebody who would be grateful for it.

You cannot use HB to pay of a mortgage, you can however use it to pay rent, but as a landlord, I can assure you, they only pay a part of it, and since it has moved to UC, it has quite frankly made being a landlord a fricken nightmare

Tbh not many ppl would even be able ro save enough on uc to get a mortgage,

Gosh that will help the rental housing crisis
What a really astonishingly stupid idea

You know that you could have £50,000 in the bank and still be entitled to tax credits right somebody’s on the legacy benefit they’re laughing.

The properties will end up being repossessed when DWP sanction the claimants.

It's a terrible idea for many reasons.

I think it’s very fair. I’ve worked my entire adult life and never had to claim benefits, up until covid happened and we had our first child during the first lockdown. I was on maternity allowance (£140pw) and my husband’s income disappeared overnight (self employed childminder). We own our own home but have minimal savings, and relied on universal credit to get us through the first few months. I don’t think it’s fair that we didn’t receive help with housing costs. We have paid into the system, and our universal credit payout was only very slightly bigger than our mortgage.

We claimed for a total of 3 months before we were back on our feet (largely due to me having to cut my maternity leave very short). I think we are exactly the sort of people benefits should help- people who have been paying into the system their entire lives, and suddenly find themselves hard up. Are these posters suggesting I should have had to sell our family home because we were going through a rough patch?

Lumping all the benefits together under UC was a mistake, tax credits allowed people to work full time, receive a top up to a liveable wage and save for the future without penalty, it wasn’t viewed as a ‘benefit’. People were moved over to UC and automatically viewed as scroungers who shouldn’t be allowed to save leaving them trapped and poor. Wish the government would make up its mind.

The Prime Minister has also pledged to turn ‘benefits to bricks’ – changing welfare rules so that the 1.5 million people who are in work but also on housing benefit will be given the choice to use their benefit towards a mortgage, rather than automatically going directly to private landlords and housing associations.

From Gov.Uk today. Boris's latest wheeze.

Personally I’d prefer people get support for a period like this than be forced to sell

I'd dispute that HB will only ever partly cover rent; it surely depends on the level of rent you set vs the maximum the LA will pay. My rent is completely covered by HB.

It’s not an idea. It’s how it’s always worked.

This isn’t a group of customers anyone wants. The risk of delinquency is too high and with minuscule deposits so is the risk of the bank not making its money back if they have to repossess and sell the property. Having too many customers like this destabilises your lending book and puts the safety of the bank at risk. The policy that the government should be putting in place to help your cousin is to increase her salary, not a policy like this that could plausibly wreck the economy if it goes wrong.

I dont understand much about the housing market tbh. Dh and i are in our mid thirties and we are trying to get a mortgage to buy our first house- we have rented privately together since we were 18. (Many different houses!). We both came from backgrounds that meant we were essentially on our own as soon as we hit 18 so it was b and bs etc then a bed sit - you know the drill!

We have had a nightmare trying to get a mortgage. Dh works full time i receive carers allowance and higher rate dla for my daughter. Our combined income is around £80,000 and we are looking to buy a terrace that costs £160,000 we have 10% deposit.

high street banks refuses us because in 2018 we had a default on a mobile phone bill - it was a stupid mistake our daughters phone we moves didn't get bills and stupidly forgot about it! Apart from that we have nothing really terrible about us and we are only looking to borrow twice our income.

we had to go to a specialist lender we are now 10 weeks in and still waiting for a yes or no.

it has been so hard to find and buy a house - i dont know what the income level for housing benefit is but im guessing its quite low and i honestly dont know how any bank is ever going to lend to anyone!

we had to send letters confirming that the dla was for our daughter and why - even though this income cant be used as part of the mortgage affordability anyway. The banks will have a an actual mental breakdown at applications from people who are not working? and if people are earning very low wages surely even with higher multiples of income they would have enough to buy anything. For what its worth i think people on low incomes/ benefits should be able to either buy or at least have access to social housing a little more easily.

we have been on the waiting list for social housing since my daughter was born (shes 12 this year so im not holding my breath! )

Delinquency?? That is offensive as only those with good credit ratings would be considered in the first place.

This is what’s so frustrating because pre-2000 actually you could get a 100% hundred percent mortgage. I don’t have any data on what the defaults look like, but I know an awful lot of people who did put down between zero and 5% deposit pre-2000 and still own their homes now having climbed the ladder so it can’t have gone too terribly wrong for them. But it got them on the ladder and into their own homes.

Delinquency is a term used in finance to describe the scenario when a borrower is behind on payments. It’s not a moral judgment. It’s used in commercial finance etc too.