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Thread: Selling home

  1. #1

    Selling home

    Hello Everyone,

    I recently sold my flat and moved to a cheaper one to be mortgage free and the remaining money to clear some credit card debts (£5000 circulating in my bank account for 3 days) now my maintenance charges are higher and I sent the bill to the DWP, they replied saying that they want to see the whole sale completion statement and if there is money left over and how they've been spent. I feel I might've done wrong in clearing my credit cards debts, will I risk a penalty instead?
    Thanks in advance
    Gio

  2. #2
    Senior Member nukecad's Avatar
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    In some circumstances you should not fully pay off credit cards, or other loans. But from what you have told us you should be OK.

    Any money left over after selling one property and buying another becomes capital/savings.
    Capital/savings of above £6k will affect Income Related benefits, and so you have to be careful how you spend it.

    Anything under £6,000 you can spend as you like.

    So if it was £5,000 left over as you say then it shouldn't be a problem, but they'll want to see the details to make sure.
    I don't know everything. - But I'm good at searching for, and finding, stuff.

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  3. #3
    Thanks nukecad for your reply. I mentioned to become mortgage free (£21000) which never circulated in my bank account. I have been reading here and there on internet that early payment of a debt is treated as capital Deprivation, but I had to clear my mortgage, because of my severe mental health problems.

  4. #4
    Senior Member nukecad's Avatar
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    Because of the way it was done, by selling a mortgaged residence and buying another, cheaper, residence outright there is no problem at all.

    Selling the property meant that the mortgage had to be paid off immediately in full, so that is not Deprivation of Capital.

    Deprivation would be if you pay off a mortgage all at once that you didn't need to pay off (ie. if you were not selling the house).

    Deprivation of Capital applies when you choose to pay off a debt all at once that you could still have paid in installments instead.

    You had no choice - when the house was sold you had to pay off the mortgage.
    I don't know everything. - But I'm good at searching for, and finding, stuff.

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  5. #5
    Thanks for your reply. I haven't been well these days. Often tearful. Lack of sleep and I am not hungry, I keep throwing up, it might be the high level of anxiety. Not last to mention the eerie hallucinations. I wish it was Tuesday already so I can give them a ring too. Thanks again Gio

  6. #6
    Hi nukecad, what kind of details they will want to see? Bank statement?

  7. #7
    Senior Member nukecad's Avatar
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    Bank statements covering the sale/repuchase period certainly, and they have already said that they want to see the 'sale completion statement'.

    I'd take 'sale completion statement' to mean the final documentation both from the sale of the old property and from the purchase of the new one.

    They will ask specifically if they want to see anything else.
    I don't know everything. - But I'm good at searching for, and finding, stuff.

    Migration from ESA to Universal Credit- Click here for information.

  8. #8
    Ok thanks very helpful
    Last edited by theitalianalien; 26-05-20 at 10:06.

  9. #9
    Bank statement covering that transaction and for the end of that month?

  10. #10
    Senior Member nukecad's Avatar
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    Quote Originally Posted by theitalianalien View Post
    Bank statement covering that transaction and for the end of that month?
    See what they ask for, they will probably want six months spread over the sale/purchase dates.

    If you want to be sure then you could ask them what they want to see.
    I don't know everything. - But I'm good at searching for, and finding, stuff.

    Migration from ESA to Universal Credit- Click here for information.

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