what on earth to do with inheritence?

[marymaryquitecontraryusedtobeafairy]

I've been left a house which to sell now would bring me about 80K in the bank.

I'm poor. I bring in about 24K/year, and am in masses of debt. I just survive. I'm a mum and I work and get benefit top ups. I'm council housed in a dire part of the country, the house is in a slightly better area but I don't wish to uproot myself and children from school and home.

What do I do? Can this help me get out of the poverty trap? Do I live off the money? Live in the house and enjoy a secure home but remain in poverty? I can't afford to do the house up but can I possibly buy a very cheap or auction place, do that up and start flipping houses as my main income?

Look I'm not that bright but I've worked hard all my life and it's just not good enough financially. I decided to be a care worker because I enjoy it but the pay alongside the increase in prices has crippled me and there's no way to get out of it so I just trudge on day by day. I'm not miserable nor are my children but I don't want to waste this opportunity.

I don't have money for a financial advisor right now nor time to research so I'm hoping you clever and wealthy lot can help me out a bit with pointing me in the right direction.

Thank you.

Its a bit off to encourage people to continue living in a council house when they own a property outright they could move to though? And it's always better to own, at 40 with kids growing this could be the making of op and people think she should stay in her lane, stop claiming for a bit and end up back where she is now. Crazy. She'll still get uc as a homeowner anyway!

i wouldn't be doing a deed of variation if I was in receipt of benefits and intended on carrying on getting benefits

I think OP's head is probably turned this pm!

She just seems to have come on here for advice/suggestions, I don't think she's a clear plan in mind.

she is very clear though she won't retrain so her income is fixed at 24K. that's useful info to all. she then needs to work out what benefits she stands to lose with what scenario.

otherwise, I agree.
@gemstoneju

benefits incl housing rights.

But shes on a debt management plan. Depending on what type of plan she is on she might be forced to sell the house to clear her debts. without that information she cant go forward with anything else

The inherited house might be a death trap, not touched for 30 years, needs rewiring etc. Could need £20k to renovate. £80k is either going to be a Terraced house or an ex-council semi. I live in a very cheap area and all that £80k would buy would be a very dated, unmodernised Terrace.

OP would be mad to move in if that’s the case.

oh, why are you bringing real life to these proceedings?! some people seem comfortable leading op away from her real situation in real life, calling us all renters!!! I own 4 homes.

OP how old are your children?
many friends have been in this predicament. Remember as soon as kids are older your benefits will change.
There is nothing being a life long renter, however in retirement you would still be paying rent. Where as to be mortgage free would be a massive help.
I would move into the house; or I would get value on your house. If it’s less than the value of the house you have inherited- Ask if you can buy under the right to buy, sell the house and pay off the debt.

@ZeppelinTits Thank you.
I see that owning is rent free and that’s maybe the opportunity I should be identifying here. However I do prefer this house, and I have a lot of plans for it if I owned it. Since this house is worth a lot less, perhaps I could get a really short mortgage and own it. I could improve the house with what’s left, and sell the house very later in life.

@HarrietJet I think that plan would be to sell the house, and use the money to get this house, but it may reduce my discount or something I don't know. Or I could just not tell the council about the other house, do my right to buy, then suddenly pay off the mortgage in full, or would they be like 'hey where's that money from? are you a drug dealer?'

This is what I was thinking. I also wondered if the house could go into a trust fund for her children if it's mortgage free.

I would fill out an RTB1 for Right to Buy. It obliges the landlord to check if you're entitled to RTB and also carry out a valuation and calculate the discount you'd be entitled to. You might be surprised at how low it is (council properties are often cheaper than non-council in the same area, and the discount can be significant (max £96k outside London). Then you will know where you stand and what your options are. It might actually turn out you could buy your council house outright if you sold the other house, possibly with money left over to clear the debts. It would not oblige you to actually proceed with RTB - if you decide not to, simply tick a box on the form and send it back. And it costs nothing to make the application.

Have the Estate’s executors transferred ownership to you via the Land registry?

If your name is already on the Deeds I’m afraid you have no chance of using Right to buy.
If the Estate legally still owns the house, I imagine it’s a legal grey area, the LA are unlikely to trawl through public wills to see if you are a beneficiary but who knows?

Putting the house in trust for the kids is storing up problems for the future, they wouldn’t be eligible for first time buyer deals, CGT would be payable and divorce or bankruptcy could make things VERY messy.

It could also be seen as deprivation of assets should OP need care in later life, there is NO time limit.

@Ohyousillydivvy I'm really leaning to using the money to outright buy this house and have that security and remain here where we are happy. I know I said the area is shitty but you see I am fine here because I'm from the same background and get on with everyone. It's shitty from the outside more than the inside.

I love my home as do my children. I don't want to move into my dead relative's musty home, it just feels like dead air in there.

I just want to do better for my children. My work is important and in a way I chose it over being wealthy but that's not necesserily fair on my children.

This opportunity must be used properly, not a chance to be missed.

Actually there could be some items in the home that are worth a lot too which I could use for debt repayments.

Are YOU the legal owner?
i.e. on the Deeds / Land registry?

If you are, you can’t use right to buy.

That is deprivation of assets. Do not do this.

Children (minors) cannot own a house.
Therefore they cannot rent it out.

For a pp, its £96 a week rent now, how much in 20 years and how will she pay when the children no longer command any benefits.

"Or I could just not tell the council about the other house, do my right to buy, then suddenly pay off the mortgage in full, or would they be like 'hey where's that money from? are you a drug dealer?'"

FFS!

If not already registered as the property owner, it’s VITAL that the Estate ( executors) sells the house as it will bypass OP.
Another thing to think about is how easy the house will be to sell, it could take many months unless you are willing to take 75% (or less) of the value for a quick ‘we buy any house’ scenario.
After 6 months, Council tax is payable - is there money in the estate to pay for this and empty property insurance ( which costs around £400) ? After a year Double Council tax becomes due.

She cannot be forced to sell a house to pay unsecured debt. The clue is in the name - the debt is not secured against the house.

OP, you need some detailed, well-informed advice from either a council or benefits official or perhaps CAB have staff who specialise in this. I think either moving to the inherited house or selling it to buy your own both sound equally valid options, but you need to check whether you are eligible to do the latter. I think I do remember reading that capital over the £6K limit if used to buy a property for yourself and your children to live in can be disregarded for benefits purposes, but I'm not sure if it applies to buying the council property you are living in. It would be great if you could buy your own house - no moving or redecorating costs, plus no upheaval for your kids. I also don't think you can hang about - once the house is legally yours, it is classed as an asset and I think you only have six months, if even that, to come to a decision. Whatever you do though, be upfront with everyone concerned - DWP do seem fond of sanctions and do a lot of checking, I think they even have the authority to periodically monitor your bank account if you are in receipt of any benefits.

If her debt management plan is an IVA she is legally obliged too. In fact if she doesn't declare it to her insolvency practitioner her IVA would fail and she would then be liable for the whole debt plus any insolvency practitioner fees that are front loaded into the plan and they are usually 5k plus. Thats why it's important to know who her debt management is with and what type of plan it is. If its just a stepchange DMP then she won't be legally obliged to sell.

OP will still be eligible for RTB if her name is on the deeds for the inherited house. The eligibility criteria is that the council house has to be occupied as her only or principal home, which will be met as long as OP continues to live in her council house.

Yes, I knew I'd read it somewhere! This is the DWP guidance around capital. Shelter Legal England - Universal credit capital rules - Shelter England. A house can be disregarded as capital for six months so no immediate panic, Same as a couple splitting up and selling their home I suppose - as long as your share is used to purchase/towards purchasing another home, which you must live in as yr permanent residence.