Universal credit and money from house sale

[DogYap]

Hey, wondering if anyone has experience of the following:
Selling my home as no longer suits my health needs as disabled. Purchasing another which is approx £30 thousand less meaning I'll have this money to renovate the new home specific to my mobility needs. Obviously aware you can't have more than 16 thousand in your savings to claim UC. My concern is that the 30 grand will be spent on the home renovating pretty quickly and I can prove this with receipts etc if needed to. Do you think UC would be understanding of what the money will go on and let me continue my benefit OR stop benefit and expect me and my son to live off what I want to use to adapt home? OR do I say nothing, chance it keep all receipts as back up or have money from sale transferred straight to family member bank account as I won't be seen to have access to it then? I'm not wanting to get myself into trouble but any help would be great thank you.

Grateful for any help

Where you are on UC and you sell your house with the intention of buying another, then any capital you have from the sale of your old house is disregarded for up to six months.

In addition, if you have money that is specifically intended to be used for making essential repairs or alterations to premises occupied or intended to be occupied as your home then that is also disregarded for 6 months as well.

You my wish to let them know that you will be selling your home and that the proceeds of the sale will be passing through your bank account and that some of the money will then be used for making alterations to the property so that it is suitable for you.

They will then disregard this capital for at least 6 months and longer if the alterations to your new home take longer than that.

You can read all the details here in the the detailed rules about capital in the DWP ADM Chapter H2 (Capital Disregards) from the gov.uk website:

https://assets.publishing.service.gov.uk/media/654111fb1f1a60000d360b54/admh2.pdf

The relevant parts are on pages 24 and 25

Amount to be used to purchase premises

H2119 Where a person has received an amount within the past 6 months which is to be used to purchase premises that the person intend to occupy as their home, that amount can be disregarded from the calculation of that person’s capital where it

1. is attributable to the proceeds of the sale of premises formerly occupied as their home or
2. has been deposited with a housing association (see H2045) or
3. is a grant made to the person for the sole purpose of purchasing a home [UC Regs, Sch 10, para 13]

Amount for repairs

H2123 Where, in the past 6 months, a person has acquired a sum of money by way of a loan, grant or otherwise which is to be used for making essential repairs or alterations to premises occupied or intended to be occupied as the person’s home, that amount can be disregarded from the calculation of that person’s capital but only where it is used for that purpose. [UC Regs, Sch 10, para 15]

By the way, the references in square brackets are to The Universal Credit Regulations 2013, Schedule 10

Thank you so much for your help. I can now contact them put it on my online journal once get closer to the time. This is a fantastic update. I've been so worried about it all. I'm hoping the works will be completed within 6 months.
Thank you very much

Thank you so much for helping. I'm not sure if my thanks above came through as new to this site

It did, thank you.

This is really good advice 🙂 Do u have any idea what 'essential repairs' covers in these circumstances, and does it only apply to someone carrying out adaptations to suit a disability?

It's not just for disability. What counts as essential repairs is going to be things like fixing a leaking roof or replacing a boiler. Or dealing with damp or maybe the house needs rewiring. Replacing a faulty toilet or bath etc

Those sorts of things.

It doesn't cover installing a fancy new kitchen or building an extension (unless those things are required to make it suitable for the person to live in)

Just to add, we were going to do this but our UC advisor made it really difficult.

She said that we had to ask permission for the equity to be disregarded for six months and said there was no guarantee it would be agreed. She also said she couldn’t guarantee how long it would take to get an answer as it had to go to a decision-maker.

We couldn’t risk that it wouldn’t be set aside so we had to opt for something different. The house we were going to buy had no kitchen or bathroom so we needed assurances that we could use the money for renovation but the UC rep said they couldn’t give us any assurances, and that we couldn’t apply in advance.

Just wanted to give the heads up that UC can sometimes be a bit difficult about this subject. Hopefully you get a better advisor than the one we had (we had multiple problems with her - I’ve posted about it before).

Gosh, surely that's just going to deter people from being open and honest? I think I'm going to be covered as a rewire will probably be necessary and I have one polystyrene ceiling which will need taking down. Also I've just been approved to provide respite for vulnerable adults, so safety is going to be a requirement. Your comment suggests that common sense may not always prevail though! 🙄

This is great advice, thank you

Why on earth would you want to buy a house with no kitchen or bathroom - especially if you’re disabled??? Sounds bonkers to me!

It’s not quite as bonkers as it sounds 😂

We basically bought a house to split off into a “main” house for me, DP, and DC and a self-contained annexe for my DM who has cerebral palsy. So “our house” had no shower room (but did have a toilet) and no kitchen.

My DM is needing more and more help as she gets older so living side by side means I can provide the help she needs without it being problematic. My DC are both autistic, both with fairly significant needs but DS especially so. DS won’t ever live independently and stills wears nappies at age 14, DD, doubtful, she can’t shower without support or cross a road on her own, again 14 yrs old. DP collapsed at work about 3 yrs ago and has been told he probably won’t ever be fit for work again. So, unfortunately yes, lots of disability/needs within the households.

A renovation project was a bit of a big task and it’s been a hard two years 🤦🏻‍♀️😂 But there were very few properties that had the right footprint and ground that were suitable to split into two sets of living accommodation.

Despite the long slog to get here, it’s been a great move especially as DM is starting to get a bit confused now too. If I was having to hotfoot across town to her every time she needed help I don’t know how I’d manage.

Before we bought the house we didn’t even get to the point of explaining any of this to UC, so it wasn’t any of these details that caused them to say it would have to be referred for a decision.

@Bertiedog - next time I’m on the laptop I’ll scroll back to find the exact message so I can tell you exactly what was said. It was very frustrating and as you say, discourages honesty. We luckily had an alternative way to finance what was required so our equity was spent immediately rather than having to wait on tenterhooks for potentially months, waiting to see if it was allowed. It made life a lot more difficult though and shouldn’t have been necessary. We were happy to prove what we were spending the money on but no one at UC was interested and couldn’t offer any guarantee that equity would be “allowed” for 6 months….