Capital Release following Remortgage of claimant’s home

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  • #22713
    GStewart
    Participant

    We gave a case where a claimant who owns her property remortgaged to release a sum of money in order to purchase an of site garage for storage.

    The claimant had then made a claim for income support however, this was refused as they deemed that the claimant had deprived herself of capital. they are now taking the capital value of the garage (£18,000) into account.

    My view is that this is very harsh on the claimant as the fact that she has remortgaged would suggest that she did not have the capital at her disposal in the first place – and had she known the route the DWP would have taken, she would not have put herself into further financial hardship..

    Would i be correct in saying that as this capital is secured against her own property this should not be considered as capital and should definately not be viewed as deprivation seeing as the capital was released for a sole purpose?

    All opinions welcome

    #9249
    Stalbansbenefits
    Participant

    Don’t agree with it being deprivation, but why would the capital value of the garage she purchased be disregarded?

    Unless she is self-employed and it is treated as an asset of the self-employed business, wouldn’t you take this into account as capital??

    #9250
    Anonymous
    Guest

    I think the DWP are certainly wrong to say the claimant deprived herself of capital because any “deprivation” was clearly not with the significant operative puropse of claiming benefit.

    Depending on the circumstances, it is possible that the garage could be disregarded as part of the dwelling occupied as her home, given that the definition of dwelling in S137 of the SSCBA does not require that a dwelling need consist of a self contained unit. There are a number of commisioners decisions that could support this, including one that went to the Court of Appeal (Miah v SoS). Oher decisions include R(SB)10/89, R(SB)13/84, CIS/427/1991.

    Admittedly, the decisions I have cited rest on whther or not it is paractiable to sell the land seperately to the main part of the dwelling, or whther or not two units should be treated as one because of the size of the family, but in CIS/427/1991, it was held that the claimants wife who was manic depressive needed to use the adjoining fields in question for walking as a means of controlling her condition.

    More information will be needed as to precisely why the person in the present case needs the gargage

    #9251
    Hilly
    Participant

    I understood from the first post that the garage is “off site” which i assume means somewhere else in the town, and therefore saleable separately.

    8)

    #9252
    Anonymous
    Guest

    Hanging on in quiet desperation, eh, Cougarboy?

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