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,

OP are you asking them to include it as income in your application? If so, they need to check that money is actually available and not currently being used to pay for additional expenses related to your disability.

I think this may have come about because there is the media coverage about changes to PIP and so they are hedging a concern that you could lose some or all of them and your stated income be impacted. It sounds as though the basis for your PIP is permanent and unchanging, though, (which I guess they are not allowed to ask about due to discrimination laws around disability).

I’d reply ‘to cover additional expenses associated with a permanent disability’.

It is a bit of a circular issue though. The bank can't discrimate on grounds of disability and your access to facilities must equate to that of a person without disabilities. Your living costs are higher because you have a disability. But the bank has a right and a duty of care to make sure your mortgage payments are affordable. How do they square that?
The only thing I can think of is that the Pip is disregarded as it should cancel out the extra costs, but if the pip is paying toward extra electricity and other household bills which have to be declared, then it's a very tangled web.
You'd think there must be a process in place to make these decisions.

I would imagine that with the government announcing a reduction in payments for PIP the bank want to know what it’s spent on so they can work out if you can still afford repayments if you lose the benefit. We just have a few years left to pay & were just sorting out new interest rates & they asked all sorts of questions about what we spend our money on. It’s just part of the process where they want to know what you are tied into paying. So if you had a regular payment to make could you still afford mortgage. It’s not personal to you.

I don’t think it’s unreasonable for PIP to be checked on though. It’s supposed to support a disability. In your case it sounds like you really need it but some people are likely to lose it. I’d be surprised if you did with that level of need.

"I’d reply ‘to cover additional expenses associated with a permanent disability’."

I'd be really careful with this, though, if you are near the upper limit of what you need. If you make it seem like it's a permanent, unchanging expense that the PIP supports, it will likely then go 'against' you in terms of the affordability checks, because it's not then a discretionary payment that could be flexed if the rate rises.

I don't think they are looking at whether you will always need the PIP or things like that, don't think they're really likely to be taking into account how it is awarded by the government or what the requirements are and how likely you are to continue getting it - it's more whether you can still afford the mortgage if interest rates rise, so they want to know about your current income and how much of it is commited versus discretionary.

Not sure I agree with this entirely as questioning any PIP payments made on account of disability is effectively discriminatory?

Perhaps @WingsofRain the best move would be to contact Scope.org.uk or a similar disability charity where they advise on benefits etc and get guidance on how to word a reply regarding this that cannot prejudice your application?

OP, they didn't ask that of your partner because as you say, he doesn't receive PIP, does he? So it's not about asking an able-bodied vs someone with a disability. It's about wanting to know how much is coming in vs how much is going out, using all the income you've submitted as reference.

If you don't want them to consider your outgoings with pip, then don't include it as part of your 'incomings' (income).

Slightly OT but wouldn't increasing the term decrease your monthly payments (albeit meaning you pay more in the long term)?

I was thinking the same.

It’s a complicated and difficult situation that I don’t want to discuss here because I’m doing my best to sort it out.

In the very specific case I’m facing extending the term will increase the payments slightly. It’s not so big an increase that it would make the payments unaffordable and I don’t think such personal questions by the bank are necessary given they want copies of my bank statements, but at least I know now this isn’t an unusual question to for them to ask.

Im still not sure how I can give them documentation to prove what I spend other than my bank statements, but I suppose I’ll need to try to suppress my worry about it until Monday when I can call them and ask.

You must be borrowing more then, and extending the term?

Or the interest rate is going to be much higher for extending the term?

Otherwise if its the same amount, same interest rate but longer term, your monthly payments would reduce.

This.

If you have declared it as income as part of your mortgage affordability then they are quite reasonable ask what outgoings you have.

If you haven't declared it as income I agree it is intrusive.

But you cant have it both ways.

It also doesn't really matter what you have paid in the past. Mortgages are much stricter now and banks go through outgoings very thoroughly

I've not read the comments but worked for a bank before & now don't work due to disability. They are asking because they want to know how much of your pop they can use as income. They aren't actually bothered if you use all/none for specific items but the number for calculating. So for example you get £110 & use all of it to lease a car then they can use 0% as income but if you don't have specific items you buy each month they may use 100% towards income. Hope this helps