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Should people on benefits be allowed to use their benefits to buy property.


working woman

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working woman
Posted (edited)

On the Credit Deflation thread, someone has just posted that Boris has recently floated an idea, that people on benefits could buy property. 

Edited by working woman
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working woman

 

Just now, One percent said:

I think they are trying even harder to piss of sap working Joe. 

Yes, that was my initial reaction.

Having worked hard for the last 35 years to buy a home to ensure I wasn't renting when I was old, I was really pissed off at the idea. 

But thinking about it, I think in some instances some people should be allowed.

I will post thoughts later on.

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One percent
1 minute ago, working woman said:

 

Yes, that was my initial reaction.

Having worked hard for the last 35 years to buy a home to ensure I wasn't renting when I was old, I was really pissed off at the idea. 

But thinking about it, I think in some instances some people should be allowed.

I will post thoughts later on.

Yep, I’m still trying to get my head around it.  One problem that has happened here with the old council housing stock is that 30? years on, many of them are holiday homes. Meanwhile, local people cannot either buy or rent in the town. 

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Do you remember this;

Before 6 April 2018, Support for Mortgage Interest was paid in the form of a benefit. However, now it is paid as a loan. You have to pay interest on the amount of loan help provided.

The government paying your interest only mortgage. 

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On first thoughts it seems nothing but an ill-thought out vote grab.

In theory, where is the deposit gonna come from, as if over a certain amount of savings you lose the benefits.

With house prices where they are I can see it only being feasible in cases where the housing is cheap and the benefits are large. By and large up north and/or impoverished areas.

But that will help with the 'levelling up' agenda as those places will increase in price, helping prevent a big crash in the overall HPI figure (although it will do nothing to prevent the expensive places falling).

Also at some point it will have to induce outrage in the classes where people have jobs and still can't afford to buy, paving the way for a prop made for them - maybe using pensions as a deposit.

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Axeman123

Now, on the one hand paying someone's mortgage for 30 years is cheaper than paying the same monthly as rent for 50+ years. It then also potentially leaves wealth to heirs that disqualifies them from benefits, if a house is sold and split. It also results in an asset for them to privately to fund a care home place. Also housing benefit is going to pay someone's mortgage, so why not the actual person to be housed rather than a landlord?

On the other hand, why not take that one step further; HB to pay the government's "mortgage" from building a council house for that person to live in?

This policy is just a kite, and a dog's dinner ideologically.

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If they allow people with a mortgage to claim housing benefit, I will seriously have to do some sums as to whether I should quit my well paid job and work part time stacking shelves, or use pension salary sacrifice to get my pay so low I will qualify for housing benefit.

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working woman

Hmmm. What happens when the person dies. Who will own the property then?

Something else to think about, so as not to annoy the workers.

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https://www.entitledto.co.uk/

The biggest mistake I made about a decade ago was plugging some numbers in here and realising I wouldn't be much worse off (about £100 a month at most) if I worked 16 hours a week (TCs, so no issues with savings over £16K). That can't possibly last thought I and carried on working full time.

What. A. Fucking. Idiot. I. Was.

I'm still telling myself it can't possibly last. :PissedOff:

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Axeman123
5 minutes ago, Boon said:

With house prices where they are I can see it only being feasible in cases where the housing is cheap and the benefits are large. By and large up north and/or impoverished areas.

That could be the one saving grace, although I doubt any government has ever done that kind of strategic thinking. Central London life-long claimants see that they could get on the property ladder with a spacious semi in the North East, based on their HB that currently gets them a shitty flat. All those precious "family and community ties" that prevent them being involuntarily "socially cleansed" from the capital suddenly evapourate at the sniff of a nice little earner. London housing is in less demand, and HMOs etc become a historical oddity. London becomes livable on the wages it can support, while the north east becomes regenerated.

Nah, that would never happen.

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apples
34 minutes ago, working woman said:

On the Credit Deflation thread, someone has just posted that Boris has recently floated an idea, that people on benefits could buy property. 

Top headline in the Mail right now:

https://www.dailymail.co.uk/news/article-10898599/Tenants-benefits-offered-new-package-help-buy-homes.html

Tenants who are on benefits will be offered new package to help them buy their own homes as Boris Johnson rekindles Thatcher's 'Right to Buy' revolution

  • Boris Johnson is bidding to relaunch premiership with major speech unveiling a new housing policy package 
  • The PM plans to rekindle Margaret Thatcher's 'Right to Buy' revolution by extending to housing associations
  • Benefits could count towards income for mortgage applications under one of the proposals from ministers 
  • Questions over how many people would be helped by the changes as no new funding is being allocated 

"bidding", "plans", "could", "questions", "one of the proposals", "no new funding", but :PissedOff:

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Posted (edited)
20 minutes ago, GTM said:

https://www.entitledto.co.uk/

The biggest mistake I made about a decade ago was plugging some numbers in here and realising I wouldn't be much worse off (about £100 a month at most) if I worked 16 hours a week (TCs, so no issues with savings over £16K). That can't possibly last thought I and carried on working full time.

What. A. Fucking. Idiot. I. Was.

I'm still telling myself it can't possibly last. :PissedOff:

I just put in some fictional figures, where my mortgage is rent, to see what I'd get if I could use HB for mortgage.

2 adults, each working 16 hours a week on min wage, 2 children under 18, £800pm "rent"

£307pw benefits

or ~£16kpa + extra £1050 for this year.

With our part time jobs, our income would be £33,660 tax free. Plus we'd qualify for all the other benefits, free school meals/trips prescription, home improvement grants etc.

It would be a significant drop in income, but we could live off that and have a far easier work/life balance.

For any households earning less than £50k pa before tax, it's a no brainer really.

Edited by snaga
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belfastchild
5 minutes ago, Wight Flight said:

If they can save up a house deposit, benefits are too high FFS!

Maybe thats the plan behind the plan.

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apples
5 minutes ago, Wight Flight said:

Gove had a solution to that on JHB this morning.

They will create a special savings vehicle that is outside the scope of the £16k cap where people on benefits can save a deposit.

If they can save up a house deposit, benefits are too high FFS!

  1. Give all my savings to a mate / convert to cash and hide under the mattress
  2. Claim all the means-tested benefits the savings disqualified me from, costing the taxpayer more
  3. Get my mate / mattress to give me my savings back to put in the special deposit account
  4. ???
  5. Profit

Do I even need to buy a taxpayer-subsidized house for step 5? O.o

What stops me doing this? I have a very low income but lots of savings, so currently can't claim any benefits.

(except my conscience / not wanting to be part of the problem)

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Axeman123
Posted (edited)

Surely, all of this ignores another issue: claimants can lose housing benefit for a variety of reasons. Any worker getting a mortgage based on a current wage is assumed to be able to replace that wage if that job falls through. If someone loses their entitlement to housing benefit, where does that leave the lender? Wouldn't a lender want a gaurantee that the claimant will never lose that entitlement? Moral hazzard and then some I would think.

On a similar note, several posters on here mention how the kids turning 18 leads to a massive drop in benefits entitlement. If a mortgage is 25 or 30 years, even assuming a new baby born on very first day, surely the mortgage is only going to be serviceable to the end if the borrower can fire out another kid in 7-12 years to keep their entitlements up. Wouldn't that imply a maximum age of the woman needing to be 20-25 years old? Instead of credit checks would the lender want fertility tests?

Edit with a further thought:

Effectively the above would mean HB becoming a de facto UBI, gauranteed at a set level and without ongoing qualifying criteria.

Edited by Axeman123
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Frank Hovis
17 minutes ago, apples said:
  1. Give all my savings to a mate / convert to cash and hide under the mattress
  2. Claim all the means-tested benefits the savings disqualified me from, costing the taxpayer more
  3. Get my mate / mattress to give me my savings back to put in the special deposit account
  4. ???
  5. Profit

Do I even need to buy a taxpayer-subsidized house for step 5? O.o

What stops me doing this? I have a very low income but lots of savings, so currently can't claim any benefits.

(except my conscience / not wanting to be part of the problem)

 

How do you propose to get that though?

If I sold my house and investments, withdrew the money as cash, and set fire to it before presenting myself at the labour exchange for benefits with no assets then they would probably let me have them for a month prior to demanding that I take any job offered or my benefits will be stopped.

There would be no easy ride as there was within lockdown where, owing to the low number of job vacancies because so many businesses were closed, you could pull six months' JSA no problem as I did.

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Castlevania
1 hour ago, working woman said:

On the Credit Deflation thread, someone has just posted that Boris has recently floated an idea, that people on benefits could buy property. 

Halifax used to count Tax credits as “income” for the purpose of mortgage applications. Admittedly a lot of families used to qualify for tax credits, but this isn’t really anything new.

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jamtomorrow
31 minutes ago, Axeman123 said:

Surely, all of this ignores another issue: claimants can lose housing benefit for a variety of reasons. Any worker getting a mortgage based on a current wage is assumed to be able to replace that wage if that job falls through. If someone loses their entitlement to housing benefit, where does that leave the lender? Wouldn't a lender want a gaurantee that the claimant will never lose that entitlement? Moral hazzard and then some I would think.

On a similar note, several posters on here mention how the kids turning 18 leads to a massive drop in benefits entitlement. If a mortgage is 25 or 30 years, even assuming a new baby born on very first day, surely the mortgage is only going to be serviceable to the end if the borrower can fire out another kid in 7-12 years to keep their entitlements up. Wouldn't that imply a maximum age of the woman needing to be 20-25 years old? Instead of credit checks would the lender want fertility tests?

Edit with a further thought:

Effectively the above would mean HB becoming a de facto UBI, gauranteed at a set level and without ongoing qualifying criteria.

And so we end up where we came in at the end of the 70s - socialised state-subsidised housing for life and a care package at the end of it. The only difference is you technically "own" your home at some point, but net position is the same once you're 6 feet under (and your home has been sold to fund the care).

Confirms what I've long thought - this lot are Tory in name only. The whole point of 80s Right to Buy was the link to self-reliance. This latest wheeze removes the last such link.

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apples
20 minutes ago, Frank Hovis said:

How do you propose to get that though?

I keep being told men can get pregnant too, so I could give being a single mother birthing-person a shot? B|

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