former owner and trusts

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  • #31766
    walmslm
    Participant

    We have a case where a customer has sold their property due to threat of re-possession. The sale resulted in him recouping £40,000 in equity from his home.

    He then formed a trust agreement with the buyers of the property whereby he re-invested his £40,000 for a 40% equity state in the house and then remained living in the property paying rent to the new owners. He then makes a HB claim in respect of the monthly rent.

    We believe that the £40,000 shoulod be disregarded under schedule 6.

    However we are considering reg 9. In respect of part h we are looking into if any other options where available to him before selling the home and in respect of part e we consider that the agreement was not done to take advantage of the scheme.

    Are there any other considerations to take into account or, part h withstanding, would you pay the claim?

    Thanks

    #88861
    John Boxall
    Participant

    Again this looks like a case where you need the full legal paperwork to establish exactly what is your claimants interest in the house.

    I would be particularly interested in what The Land Registry says about his interest in the property.

    Annual income twenty pounds, annual expenditure nineteen nineteen and six, result happiness. Annual income twenty pounds, annual expenditure twenty pounds ought and six, result misery. The blossom is blighted, the leaf is withered, the god of day goes down upon the dreary scene, and—and in short you are for ever floored.

    Wilkins Micawber, Ch12 David Copperfield

    #41782
    peterdelamothe
    Keymaster

    I think you would have to consider a range of reg 9 options here. Firstly, is his situation analogus to being an owner? Secondly, who is entitled to charge rent and to whom? In effect as a part owner of the shares is he charging himself rent? Part-ownership scheme?

    I must admit that on the face of it I am doubtful if I would ever pay such a claim. There are a lot of hurdles a claimant would have to cross here. A case to get your teeth into.

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