JSB to JSA means test, mortgage, negative equity

[truthseeker]

SW have refused my claim for JSA based on my means test.

Our savings combined with my husbands income put me over the minimum means for me to claim.

But they did not take my mortgage or negative equity into account in the calculation.

In theory, I could take ALL of my savings, pay them into the mortgage, leaving me with zero savings and Id still have a mortgage outstanding.

I went up to SW to query this, but when I pointed out the above (ie, that my mortgage and NE effectively wipe out my savings) the girl on reception contradicted herself and was then quite rude to me, so I simply asked for an appeals form and left.

Anyway, maybe someone here knows the answer. Is it true that I could fail the means test today, but if I paid all my savings into my mortgage and re-applied for the means test, that I could pass it tomorrow?

 

[vandriver]

Might not be as simple as you think to transfer your savings into your mortgage.From a cursory reading of the regulations,it seems a deciding officer would have to be satisfied that the transfer was reasonable,or the capital would still be counted.
Extract below

Property Transferred Where it appears that a claimant has either directly or indirectly deprived himself/herself of any income or property in order to qualify for a payment, or to qualify to a payment at a higher rate, the income or the yearly value of the property must be assessed as means against the claimant.

In such cases, where the yearly value of the property or income has decreased since the date of deprival or transfer, account shall be taken of this decrease. In a case where the value of the property or income has increased since the date of deprival or transfer, the means assessed will not take account of this increase.

 

[gipimann]

Mortgage repayments are not taken into account for the JSA means test, neither is negative equity. Outstanding mortgage debt cannot be offset against savings as you've described.

The following is taken from the Operational Guidelines on Means Assessment:

Large withdrawals of capital should be investigated - receipts should be requested to validate large sums spent. See "Property transferred" below re capital that is transferred to another person. Withdrawals that are not satisfactorily accounted for should be assessed.

Property Transferred
Where it appears that a claimant has either directly or indirectly deprived himself/herself of any income or property in order to qualify for a payment, or to qualify to a payment at a higher rate, the income or the yearly value of the property must be assessed as means against the claimant.
In such cases, where the yearly value of the property or income has decreased since the date of deprival or transfer, account shall be taken of this decrease. In a case where the value of the property or income has increased since the date of deprival or transfer, the means assessed will not take account of this increase.

Link: http://www.welfare.ie/EN/OperationalGuidelines/Pages/meansassess.aspx

It will be up to the deciding officer to determine whether in your case, repayment of a mortgage with your savings is considered "deprivation of income to qualify for a payment".

 

[truthseeker]

It will be up to the deciding officer to determine whether in your case, repayment of a mortgage with your savings is considered "deprivation of income to qualify for a payment".

Thanks for the responses. It seems very unfair. I am not in any different position than someone who has zero savings and a smallish mortgage who would qualify. Its just how you move things round on the balance sheet.

When I asked about signing on for credits the person on reception rolled her eyes to heaven and told me to come back after lunch if I wanted (it was midday). I got the impression Im probably not allowed to do that either? (hence the eye roll?)

 

[wbbs]

Well if you are looking for work then there is no reason why you cannot sign for credits even if no payment is due to you.

Negative equity in itself does not really exist unless you are selling the property, only then does it actually appear so this could never have an impact on your means test.

Why don't you pay down the mortgage with some savings, I think that is a very reasonable thing to do if someone is out of work.

 

[truthseeker]

Well if you are looking for work then there is no reason why you cannot sign for credits even if no payment is due to you.

Oh am I allowed to do that? I got the impression with the eye rolling that I was asking to do something I shouldnt.

Why don't you pay down the mortgage with some savings, I think that is a very reasonable thing to do if someone is out of work.

The reason that I have not is that I have most of the money invested and the interest rate on the investment is higher than the interest rate on the mortgage - so it makes more financial sense not to pay it off the mortgage.

Another reason is that if things do not improve soon I may end up leaving the country altogether and if I do so Id use the savings to fund such a move, I could rent out my apartment to cover the mortgage if I did such a thing.

And the last reason is that the JSB I was receiving didnt even cover the mortgage repayments monthly, let alone groceries and bills so I have needed my savings to live off.