Terms & Conditions

[Amanda JB]

Hi

Just trying to fathom something out

Claimant is receiving mortgage payments as part of his UC but it falls way short of his actual interest only payments. He argues he receives a relevant award of universal credit for housing costs which is not defined as rent only so he should be entitled to claim DHP.

The DWP guidance manual says DHP is not for owner occupiers unless its a shared ownership

Can anyone help as not sure where this guidance fits in

[nick dearnley]

The relevant provision is Sch4 UC Regs 2013, pointed at by reg 1 DFA Rrgs 2001:

‘ “relevant award of universal credit” means an award of universal credit the calculation of which includes an amount under section 11 of the Welfare Reform Act 2012, calculated in accordance with Schedule 4 to the Universal Credit Regulations, or would include such an amount but for paragraph 3(e) of Schedule 1 to those Regulations; ‘

Sch4 UC Regs is entitled ‘Housing costs for renters’ https://www.legislation.gov.uk/uksi/2013/376/schedule/4

Sch5 on the other hand covers housing costs for owner-occupiers, so in your case the housing element is not under Sch4 and therefore doesn’t engage the DFA Regs. On top of that UC Regs 25(2) specifies that payments in respect of accommodation must be ‘within para 2 Sch1 (“rent payments”)’.

As an aside, I think Sch5 only applies to service charges (ground rent etc) rather than mortgage interest because of reg 26(3).

[Amanda JB]

ah ah perfect

So we need to be saying that because Sch 4 is for renters, reg 1 of the DFA Regs 2001 definition of “relevant award of universal credit” is for renters only and does not cover housing costs for owner-occupiers as that is covered under Sch 5

[Amanda JB]

on a side note, he does get mortgage interest payment within his UC award, do you know under what part this is paid?

[nick dearnley]

Yes, I think that’s right, by my reading, at least. Reg 1 DFA tells us what are housing costs for DHP purposes and they’re only those in Sch4.

I’ve not looked at the mortgage payments part, but I think they’re here: https://www.legislation.gov.uk/uksi/2013/376/schedule/4 in the Loans for Mortgage Interest Payments Regs 2017. I’m not sure, though to be honest.

[Amanda JB]

looking into this further it looks like he doesn’t even get housing costs in his UC because its paid via Loans for Mortgage Interest Payments Regs 2017 (hes been getting it since 2019) but because its paid as part of his UC payments he thinks its UC housing costs, sch 5 of the above regs omitted housing costs for owner occupiers from the UC regs apart from service charges.

Am I understanding this correctly as we need to send a DHP decision with a detailed explanation.

[nick dearnley]

I think you have that right Amanda. Sch4 is the only relevant one for DHPs, and as owner occupier payments (albeit only service charges) are sch5 and mortgage interest is under the 2017 Regs he’s not covered.

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