Bank asking about what I spend my PIP on

[WingsofRain]

I’m currently applying for a mortgage and the lender has asked me to provide proof of what disability related expenses I use my PIP for. I’ve not come across this before and I’m very uncomfortable about it.
I don’t buy specific items, it is used for general living expenses like heating, electricity and running my WAV.
Have any of you been asked these sorts of questions before, and how did you answer? I can’t give them specific documents - it’s almost as if they are expecting me to show them receipts for equipment or something,

”Expenses related to my disability” should be all that’s required. How odd.

I have never, ever heard of this.

Maybe because disability benefits aren’t designed to be an income replacement, they are to help pay the additional costs associated with having a disability. Perhaps the bank are trying to decide if you are essentially supporting your everyday expenses with PIP and/or determine what additional expenses you have because of your disability?
I’m not being goady, I worked in welfare rights & benefits for many years.

I’m not sure I quite understand you, maybe it’s the same thing as I’m finding confusing about the bank’s question.
Surely all they need to know is whether or not we can afford the payments on the mortgage, not what I choose to spend my money on?

Because I am paraplegic I have higher than usual costs for electricity and running and maintaining a large vehicle. I have care needs which form part of my award, but my partner is my carer - I don’t pay him.

I don’t use PIP as an income replacement, I work for my income, PIP is a supplement to that.

I think that's what you need to tell them. And no more than that.

Could be that they're getting twitchy about the government's antics and the continuation of PIP payments..

Banks look at personal expenditure full stop. Basically, they want to know what you spend your money on. If you google you find lots of detail.

It's not about the source of the money. It's about how you spend it. I think it's something to do with affordability checks.

One of my neighbours applied for a mortgage last year and she belongs to a very expensive gym. She was very surprised that they commented on it in her meeting. But ironically, it was viewed as an expense that she could cut if she lost her job or whatever. So it might have gone in her favour. I think it all factors into their very complicated affordability thing.

If they've asked specifically about PIP I find that a bit strange but I suppose you had to tell them about your income in total?

it is worth googling, and there's lots of discussion on Reddit.

i'm old enough that people didn't ask these questions for my first mortgage so I was really uncomfortable with it as well.

It’s so they’ve got an informed picture of your income and expenditure to assess affordability.

I am a Mortgage Adviser for a bank, we have to ask the question when including PIP in affordability assessments, as if your disability does come with additional costs like paying for private treatment, care, vehicle these have to be keyed as commitments to ensure you can still afford them and the new mortgage you are applying for. If you don’t have extra costs like that then just say you don’t.

I’ve just gone through the most intrusive mortgage application process I’ve ever done & it’s mind blowing the level of detail they’re asking for now. I don’t have the PIP element to account for, but every other aspect of my finances were scrutinised to the nth degree & I was not prepared for that at all. So I get how jarring it is to be asked, more so for something that feels more personal when it’s linked to PIP.

On reflection now I’m out the other side & I have my offer of a new mortgage, I can almost appreciate the level of scrutiny as it did make me really think about the amount I was borrowing & my financial plans beyond that. I thought a lot harder about it this time than any other time I’ve remortgaged. But it was still incredibly intrusive & felt incredibly judgemental at the same time.

I hope you get through it & out the other side too.

Agree with this.

My ds has hereditary spastic paraplegia and also works - his PIP covers his adapted car and goes towards extra heat and electricity as well as mobility aids etc.

I couldn’t say exactly what it’s spent on day to day but it goes towards the extra costs (inc a second hand but spare wheelchair which as you know the active user ones aren’t cheap!).

But he has a steady income from employment and no UC or anything else that will change.

I think it’s probably part of the affordability test with how uncertain it’s become.

Which bank is this? I know some banks are happy to class benefits as income when calculating mortgage borrowing and some aren’t. Is this part of that?
I have been told Nat West are very good at accepting applications from people with benefits as part of overall income if that helps you?

This is what I'd tell them too.

I wasn't asked anything about mine when we applied for our mortgage in 2018. But I do wonder if the new cuts and things have influenced them.

Thanks everyone, it’s a confusing situation and although I’m generally a resilient person I’m finding this very upsetting. Having people to talk to about this sort of thing who have experience of it really helps.

The bank isn’t Nat West, it’s another major bank and it’s our current lender. For reasons I won’t go into here, but not at all of my own doing, we are having to increase the term of our mortgage which will increase the payments slightly. It’s a minimal amount and easily affordable. They know we can pay them, we have an unblemished 25 year record with them having never missed a payment.

I am fine with them wanting to know what regular outgoings we have, they will get that from bank statements, but what I’m upset about is them specifically asking me to produce documents proving my “disability related expenditure”, especially when they haven’t asked my partner for anything like that.

I’m going to have to try to call them today and ask what sort of proof they want, because beyond the bank statements that any able bodied person would submit there isn’t anything I can give them that shows how often I shower or wash my clothes because of me being doubly incontinent for example - nor would I want to discuss that with a stranger in a bank!

I seriously feel that they shouldn’t be asking that sort of thing of a disabled person when they aren’t asking an able bodied person.

As it happens my partner also has a (mild) disability but because he isn’t badly affected enough to need or qualify for any benefits he isn’t being asked for anything other than bank and pension forecast statements.

We were told that we would have to drop our private health insurance as we couldn't afford it. We were very adverse to doing this as we have pre existing conditions and it would have been difficult to reinstate. In the end we said we would, but they never checked up on it, we got the mortgage and carried on paying the health insurance. Bloody glad we did as I now have cancer and we never struggled with our payments.

Tell them it's ring fenced for your disability.

I suppose if you ate spending it specifically on something e.g. paying a cleaner, funding physiotherapy then you won't have that money available to pay your mortgage with

I'm not sure that's the best idea.

They're looking at affordability for the mortgage, the fewer commitments the couple has, the better the affordability if one of them loses a job.

@WingsofRain It’s surely looking at all sources of money and affordability. Your partner doesn’t get extra money so it’s not in the mix. You just say what it’s used for and that accords with what the government expects. I would not want it assessed as being income, so I’d want it discounted for affordability. It’s extra and not earned income which makes it different.

They've not asked your partner, so he also gets PIP but they haven't asked him what his PIP is spent on? I'd guess as others are saying, it's to work out if you have any disability related financial commitments (motability car, ongoing therapy sessions etc) that would bring your affordability levels down. For example I'm asked about child related expenses ie nursery fees. Just as you're being asked about disability related expenses. It's not any kind of discrimination OP if that's what you're hinting at.

I'm surprised they are considering it at all because it's money to pay the extra costs related to your disability and not guaranteed long term.

I suppose they see those disability related expenses as essential and not something you can cut if times get tough, so it could effect your ability to pay a mortgage. Perhaps they are thinking pip reforms mean you might not get PIP soon, but will still have those costs.

I've never heard if this either and can see wht it feels upsetting / intrusive in the current climate.

Its about affordability, they may well think that you're using PIP to pay for everyday expenses and if so, that might indicate you cant afford your everyday expenses

Thats all they need to know that your PIP is for your additional expenses.

They aren't seeing additional expenses and PIP often have them. Explain it covers higher utility bills related to your disability and they will stop digging.

I will say though I dont get all this 'its intrusive'. You're asking to borrow their money! They can ask what they like!!

Try getting travel insurance with a myriad of health concerns and multiple GP visits over the past year, thats intrusive!

are you self-employed? I applied as someone self-employed, and as others have said, it was all about them finding out which of my expenses were 'optional' in some way and which were commitments. I was declined at one point because I'd been putting regular over-payments into a pension - they said because I'd been doing it regularly, it was therefore seen as a commitment, when actually it was totally my choice to do it with the extra rent I'd been saving for that year or two before applying! So it's commited payments that they don't like. I had to explain away various other payments that I considered optional, but they might have considered commitments - different sorts of insurances, for example, or work-related subscriptions, or other activities. The adviser on the phone was quite helpful at deciding that something was easily given up - the underwriters didn't always agree (i.e., the pension payment!).

So I think it will be all about how much of your income is flexible vs committed, and what you need to spend the PIP on will be part of that. If it's things like electricity and heating, then that will be seen as a commitment and not taken into account as potential flexiblity if the mortgage rises. If it's something less vital, adaptations on a holiday or whatever, and you could choose not to go on the holiday, then that might be different.