I have a client who was forced to sell her home due to mortgage arrears
after debt clearance and additional expences she was awarded Income support as unfit for work. She then applied for HB and CTB which we thought was straight forward full benefit due to IS our local council is now demanding written proof that she had to sell her home and have refused to pay any benefit surely an award of IS passports to full HB CTB without further evidence

Hi Crissy,

Thread probably should be moved to HB/CTB board, but-
Is the property your client is renting the same one as she previously owned? If so, regardless of IS being in payment, she will need to demonstrate that she had no choice but to sell her home in order to remain there. If not, HB won't be payable (Reg 2(1) of HB regs) if she owned currently rented property within last 5 years.

thread moved from tax credits to housing benefit forum

Very new to this so apologise for posting to wrong board.

Yes 1964 it is the same property but her previous mortgage company have agreed to provide details of arrears and their intention to seek repossession so I think that should satisfy LCC

The relevant reg is HBR 9(1)(h).

It won't (normally) be enough in itself to show there were mortgage arrears. The LA may also ask what options were considered by the clmt, other than to sell the property. Such an approach would be consistent with several CDs on this issue.

The is whether or not the clmt (or partner) had to relinquish ownership in order to continue to occupy that same property. So there are two tests:

1) Did ownership HAVE to be relinquished?; AND, if so
2) Was the relinquishing of ownership for the specific purpose of remaining in occupation?

The "compulsion" test for relinquishing ownership is not absolute, but it must be along the lines of being a practical or legal compulsion. A moral obligation, in itself, is not sufficient.

Hope this helps.

new cd summary might be of interest ... in briefcase @

CH/2340/2008 — Sale and lease back / whether claimant could have continued to occupy property without relinquishing ownership (04 November, 2008)

There are a number of other cases which, I think, could be distinguished.


e.g. in R(H) 6/07, formerly CH/3450/2006, the commissioner says, dismissing the appeal,

“the tribunal identified a number of steps the claimant and her husband could have taken to avoid selling their home and found (applying CH/3853/2001) that the claimant and her husband were not under a practical compulsion to sell, although subjectively they may have believed themselves to be.”

and

“2. it is impossible in the normal use of language to interpret "could not" to mean "believed she could not" and, apart from exceptional circumstances, such as extreme stress, where the claimant's perceptions might limit the options available, the claimant's perceptions are not relevant to the application of the test (paragraphs 17 to 19).”

The tribunal listed some of the factors they considered, including

“10. The chairman considered what options were available to the claimant and her husband. He ruled out a remortgage on account of their ages and the size of the property. He also ruled out taking in a lodger on account of the sleeping arrangements. However, he found that the couple could have taken steps that would have allowed them to retain ownership of their home. Specifically, they could have contacted the mortgagee and the credit card companies to discuss payment arrangements. Nor had they considered contacting the CAB about debt management. The chairman did not itemise the possibilities, but they are well-known. The credit card debts could be consolidated; a schedule of repayments could be negotiated; there was more than sufficient equity in the property to provide security for repayments; and an equity release scheme might be appropriate.”

In CH/1586/2004 the commissioner says

“There seems to have been no investigation as to whether they could have obtained employment and financed the mortgage that way (which is how most people finance their mortgages), or as to whether they could have raised an income by sub-letting part of the property (for example, to their son to develop his business), or as to whether they could have run some slightly different sort of business rather than selling the property. The tribunal was in error of law in failing to consider such matters.”

And in CH/859/2006 the point is made again

“9. The second point on which I disagree with the submission for the Local Authority is the extent to which the tribunal was obliged to inquire into and make findings on the claimant's financial position. In paragraph 15 of CH/396/2002 and in paragraphs 10 to 17 of CH/3853/2001 the Commissioner who made those decisions explains that the resolution of the questions relevant to the exception to the regulation 7(1)(h) rule involves a consideration of the nature and extent of the claimant's health and financial problems. The compulsitor which justifies the application of the exception is, as the Commissioner explained, not merely legal compulsion but also practical compulsion.”